New Delhi, Feb 16 (.) Deal activity in India began 2026 on a subdued note, with overall transaction volumes and values declining sharply in January amid the absence of large-ticket mergers and acquisitions (M&A), according to the latest Dealtracker report by Grant Thornton Bharat released here on Monday.
The report recorded 207 deals worth USD 7.2 billion in January 2026, including IPOs and QIPs, marking an 11 per cent drop in volumes and a steep 60 per cent decline in values compared to December 2025. Excluding public market issuances, 199 deals aggregated USD 5.9 billion, with volumes down 8 per cent and values falling 56 per cent month-on-month.
The moderation was largely attributed to softer M&A momentum, even as private equity (PE) investments remained resilient and capital markets continued to offer selective access to funds, indicating sustained investor engagement despite a cautious start to the year.
Shanthi Vijetha, Partner – Growth at Grant Thornton Bharat, said January marked a measured beginning for India’s deal landscape due to the absence of large-ticket M&A transactions. She noted that while aggregate deal values moderated sequentially, private equity maintained steady participation through growth and expansion capital, and the visibility of IPOs and QIPs reflected continued access to public capital. She added that policy continuity, infrastructure-led growth, capital formation priorities, expectations from the union Budget 2026, and progress on the proposed India–EU trade agreement are likely to shape dealmaking sentiment in the coming months.
In the M&A segment, activity softened considerably with 73 deals valued at USD 3.1 billion, compared to 109 deals worth USD 8.7 billion in December. This translated into a 33 per cent decline in volumes and a 64 per cent fall in values.
The absence of multiple large-ticket transactions significantly impacted aggregate numbers. However, deal values remained concentrated, with Coforge’s USD 2.4 billion acquisition of Encora accounting for nearly 40 per cent of the total M&A value for the month.
The trend underscores a selective environment where high-conviction strategic transactions continue to anchor activity.
Private equity activity, meanwhile, demonstrated resilience with 126 deals worth USD 2.7 billion. While participation levels remained healthy, the average deal size declined sharply from USD 43.3 million in December to USD 21.6 million in January, signalling investor preference for smaller, growth-stage investments.
The month also saw Juspay Technologies enter the unicorn club following a USD 50 million fundraise, highlighting continued confidence in India’s fintech and innovation-driven platforms.
Capital markets remained cautiously accessible, with three IPOs raising USD 0.5 billion and five QIPs mobilising USD 0.8 billion during the month, offering selective avenues for capital deployment.
Sectorally, IT and ITeS led deal values with 19 transactions worth USD 2.4 billion, driven primarily by the Coforge-Encora deal. Retail and consumer emerged as the most active sector by volume, recording 39 deals, although overall values declined due to the lack of large-ticket transactions.
FMCG and food processing segments continued to attract investor interest.
Banking and financial services witnessed a sharp correction in values, with 17 deals totaling USD 466 million, reflecting a high base effect from December. However, fintech activity remained robust, supported by Juspay’s fundraise.
Manufacturing and real estate displayed divergent trends. Manufacturing recorded healthy volumes but lower values amid selective consolidation, while real estate saw increased volumes but moderated deal sizes, including transactions driven by insolvency resolutions.
Energy, hospitality, and emerging sectors showed pockets of strength. The energy segment shifted toward fewer but larger deals, led by cleantech investments. Hospitality rebounded strongly, and aerospace and defence gained traction, supported by policy-backed momentum.
Overall, while January 2026 reflected a cooling in headline deal values, the underlying activity across private equity and select strategic sectors suggests that investor appetite remains intact, albeit calibrated, as market participants await clearer policy signals and macroeconomic direction in the months ahead.
. SAS RSA