Consumer and retail dealmaking rebounds on volumes but slips in value, while automotive investments pivot towards EVs and mobility platforms: Grant Thorton Bharat

India’s consumer and retail sector saw deal activity pick up in the first quarter of 2026, though investors continued to stay careful about where they were putting larger amounts of money, according to Grant Thornton Bharat’s Consumer and Retail Dealtracker report for Q1 2026. While transaction volumes improved across both M&A and private equity activity, overall values remained under pressure because the market did not witness the kind of large-ticket deals that had previously boosted headline numbers. 

“The Jan-Mar quarter of 2026 signals a phase of measured recovery in India’s consumer and retail sector, with deal activity rebounding in volumes even as capital deployment remains selective,” said Naveen Malpani, Partner and Consumer Industry Leader at Grant Thornton Bharat LLP. “Overall, the quarter reflects a market that is transitioning from scale-driven expansion to disciplined growth, where capital is increasingly directed towards category leaders, differentiated propositions, and sustainable business models.”

Overall deal activity during the quarter stood at 146 deals valued at $1.5 billion. Of this, PE/VC activity contributed 105 deals worth $1.1 billion, while M&A activity accounted for 40 deals valued at $358 million. IPO and QIP activity remained muted, with only one transaction worth $42 million taking place during the period. 

The report noted that deal volumes rose to 145 deals in Q1 2026 compared with 139 deals in Q1 2025, but total deal value fell almost 63% year-on-year to $1.4 billion because of the absence of large-ticket transactions and a clear shift towards strategic dealmaking. M&A volumes, meanwhile, climbed to a post-Q1 2022 high of 40 deals, up 54% year-on-year, driven by domestic consolidation and increased outbound participation. However, values declined sharply to $358 million from $2.2 billion in the year-ago period. 

The report said strategic consolidation remained one of the defining themes of the quarter. Reliance Group completed seven acquisitions, including five outbound deals, while Marico executed three transactions worth $78 million as companies focused on portfolio expansion and capability enhancement. 

Personal care emerged as one of the strongest segments during the quarter, attracting investor attention towards “science-backed, ingredient-led, and premium beauty brands”. The report added that the category is undergoing “a structural shift, from mass to efficacy-driven and specialised offerings”. Food processing and FMCG also remained key drivers of activity as investors continued backing branded, value-added and health-focused businesses. 

“The evolving FTA landscape is expected to further shape the competitive intensity in personal care, with reduced import barriers likely to facilitate greater entry of global brands and widen product access for consumers,” the report said, adding that this could accelerate premiumisation while also increasing competition for Indian brands. 

Personal care emerges leader in M&A, FMCG in PE

Food processing led M&A deal volumes during the quarter with 13 transactions, followed by personal care with 10 deals and FMCG with eight deals. In value terms, personal care emerged as the leading segment at $155 million, supported largely by Hindustan Unilever’s $90 million acquisition of Oziva. Other key deals during the quarter included Cupid Ltd’s investment in Baazar Style Retail, Marico South-East Asia Corporation’s acquisition of Skinetiq Joint Stock Company, Marico’s acquisition of Cosmix Wellness and its acquisition of 4700BC Popcorn. 

On the PE side, FMCG led in value terms with $347 million in investments, driven largely by General Atlantic’s $278 million investment in Balaji Wafers. Food processing followed with eight deals worth $257 million, including Apax Partners’ investment in iD Fresh Food valued at $167 million. 

The report also highlighted investments in brands such as Swish and The Whole Truth, reflecting continued investor interest in digital-first and health-focused consumer businesses.  “PE/VC activity remained resilient, with steady deal flow and sustained investor interest in scalable, profitability-led businesses, despite a more measured and disciplined funding environment,” the report said. 

Automotive investors double down on EVs, mobility and auto-tech

In the automotive sector, investors continued to direct capital towards EVs, mobility platforms and auto-tech businesses, even as broader deal activity remained selective amid geopolitical uncertainty and supply-chain concerns.

According to Grant Thornton Bharat’s Automotive Dealtracker Q1 2026 report, the sector recorded 35 deals worth $745 million during the quarter. PE/VC activity accounted for 28 deals valued at $702 million, while M&A activity remained relatively subdued at seven deals worth $43 million. There were no IPO or QIP transactions during the period. 

 “India’s Auto & EV sector is entering 2026 at an important inflection point, where the near-term operating environment is being shaped by three clear forces: improving domestic demand visibility, accelerating electrification and platform adoption, and a sharper focus on resilience as geopolitics and trade conditions remain fluid,” said Saket Mehra, Partner and Auto & EV Industry Leader at Grant Thornton Bharat. 

 “Against this backdrop, Q1 2026 deal activity reflects steady participation with selective capital deployment, with investor and acquirer interest remaining concentrated in future-ready themes such as electrification, mobility platforms, and enabling ecosystem infrastructure,” Mehra added. 

 The report said geopolitical developments were increasingly affecting exports, logistics planning and supplier resilience, particularly for Tier 2 and Tier 3 auto component suppliers facing higher freight rates, commodity costs and supply-chain disruptions. 

 While overall deal volumes remained stable during the quarter, values normalised sharply compared with earlier periods that had been boosted by large outbound deals. Outbound M&A value fell from nearly $4.06 billion in Q3 2025 to around $10 million in Q1 2026. 

M&A activity remained focused on capability-led and bolt-on acquisitions. Auto-tech accounted for five of the seven M&A deals completed during the quarter. Key transactions included Cars24’s acquisitions of Carinfo and Vehicleinfo, Uber’s investment in Carrum Mobility Solutions, Sai Green Mobility’s acquisition of 2getthere B.V, and Spinny’s acquisition of GoMechanic assets. 

The report said these transactions reflected “a clear shift toward integrated, technology-led solutions across the vehicle lifecycle, spanning discovery, ownership, servicing, and resale.” EVs emerged as the biggest theme within private equity activity, accounting for 11 deals worth around $448 million, while mobility-as-a-service contributed nine deals valued at nearly $210 million. 

The report noted that investors continued backing electric buses, last-mile EV businesses, fleet electrification and battery-linked platforms that were demonstrating “commercial traction, predictable utilisation, and readiness to scale”. Among the largest transactions during the quarter were KKR’s $315 million investment in PMI Electro Mobility Solutions and Allfleet India, IFC, BII and Tata Capital’s $89 million investment in Greencell Mobility, Nomura’s $80 million investment in Drivn Transition and Euler Motors’ $78 million funding round backed by Lightrock, Hero MotoCorp, Blume Ventures and BII.

The report also highlighted continued investor interest in EV charging, battery swapping and battery technology firms such as Statiq, Battery Smart, Coulomb LiTech and RoadGrid. Traditional automotive segments including automobiles, heavy vehicles and auto-components, however, witnessed weaker activity during the quarter amid margin pressures, cautious OEM demand and rising capex requirements linked to the EV transition.