Lower deals: The number of merger and acquisition (M&A) deals during 2023 fell by 10 per cent on a year-on-year basis to 793 in 2023, as per a PwC India report.

The total disclosed deal value for M&A were on a steeper decline at 38 per cent during last year, the report titled ‘Deals at a glance’ pointed on Sunday.

As per the findings of the report, Private Equity (PE) investments were at a total of $36 billion, which is a 36 per cent drop when stacked against 2022 numbers.

However, the average investment size per deal was up $46 million as compared to $42 million in 2022, which shows a shift towards larger opportunities.

Even as early-stage investments were lower by 53 per cent as against the numbers in 2022, the report said, these continued to make up the major share along with growth-stage investments.

This was at a total of 73 per cent of fundings in 2023. 

Conversely, buyouts showed resilience with only a 5 per cent decline compared to 2022.

The findings of the report point towards a nuanced landscape, wherein investors reflected interest in diverse strategies and larger-scale ventures, amid an overall decrease in PE investments.

Dinesh Arora, Partner & Leader Deals at PwC India said "In 2023, India resiliently navigated global headwinds, solidifying its appeal to international investors. The economic fundamentals stay strong reflecting investor enthusiasm for the country's expanding economic opportunities and this optimism is also echoed in PwC's latest CEO Survey.”

Despite a restrained deal-making environment throughout the year, the deal activity has stabilised towards the last quarter which leads them to anticipate an upswing in 2024, he added.

The retail and consumer sector emerged as the most active sector in 2023, PwC said, while technology finished up marginally behind for the second consecutive year.

These were followed closely by professional services and fintech sectors, which exhibited high activity in terms of volume. 

Financial services, renewable power and healthcare also dominated in deal value.

The top 10 deals of 2023 include joint venture (JV) buyouts, along with strategic investments, PE buyouts, and stock mergers. These collectively contributed to 21 per cent of the total deal value. 

While PE deals were higher in volume overall, strategic deals dominated the top deals. Domestic deals and group-level consolidations also emerged as a significant theme, as per the report.

PwC is a network of firms in 152 countries with over 3,27,000 people providing assurance, advisory and tax services.

(With PTI Inputs)