Despite a turbulent global geopolitical landscape, India's mergers and acquisitions (M&A) market is projected to sustain an annual run-rate of approximately $200 billion, according to Rajesh Singhi, global co-head of M&A Advisory at Standard Chartered Bank. This activity is evenly split between domestic, inbound, and outbound transactions. Singhi describes the global M&A environment as a 'tale of two halves', with the US and Europe focusing on mega deals and domestic consolidation, while India, South-East Asia, and the Middle East are driven by energy transition and infrastructure needs.

A notable trend is the resurgence of outbound acquisitions by Indian firms, exemplified by Sun Pharma's recent overseas acquisition, which is considered one of the largest by an Indian corporate. Singhi attributes this trend to three main factors: the need for technology access in a rapidly evolving industrial landscape, the restructuring of global supply chains, and the search for growth opportunities abroad as domestic markets show signs of stagnation. Key sectors witnessing this outbound interest include pharmaceuticals, healthcare, and information technology.

Within India, the financial services sector continues to attract significant foreign interest, highlighted by the strategic investment from Emirates NBD in RBL Bank. Singhi emphasizes that financial services serve as a strong indicator of GDP growth, typically translating into higher growth rates for banks. Additionally, the wealth and asset management sector is emerging as a hub for unicorn creation, driven by a shift in Indian household savings towards mutual funds and equities.

While concerns about elevated valuations persist, Singhi notes that India's historical trading range of 18-22 times price-to-earnings reflects strong growth prospects. The ongoing high interest rate environment is reshaping deal financing, with strategic buyers becoming more prominent as private equity sponsors take a step back. Finally, the Reserve Bank of India's recent decision to allow domestic banks to participate in acquisition financing indicates confidence in the banking system's readiness for such engagements.