While M&A took somewhat of a hit in 2020, primary bonds and equity markets saw a flurry of Indian companies raising capital as a response to the pandemic, Tan argues. Evidently, Indian ECM activity set a new annual record with $37.6 billion worth of proceeds, surpassing the annual record of $31.2 billion set way back in 2007, as follow-on offerings hit all-time highs and initial public offers picked up activity during the second half of 2020. “Meanwhile, bond offerings from India raised $72.1 billion and witnessed the second highest annual total after last year’s [2019's] record high, benefiting from lower borrowing costs driven by domestic policy measures,” Tan adds.

As for M&A, the key deals of 2020 include Facebook Inc.’s $5.7 billion investment, in Reliance Industries’ majority–owned Jio Platforms, for a 9.9% stake. While Facebook–Jio Platforms was the largest India-focussed deal of 2020, in a privately negotiated transaction during the third quarter, Google International—a unit of Alphabet Inc—also acquired a 7.73% minority stake in Jio Platforms for $4.5 billion. No marks for guessing that the U.S. was the most active foreign acquirer in India during 2020 in terms of value as well as number of acquisitions, as value doubled to $19.1 billion from 147 deals compared to a year ago, capturing 51.9% of India’s inbound M&A market share.

At the same time, outbound M&A activity from India totalled $4.4 billion—up 58.4% compared to 2019, and the U.S. was the topmost targeted nation, both in terms of value as well as number of acquisitions from Indian companies, with 43 deals worth $3.5 billion, or 79.7% market share.

According to Refinitiv, a majority of the deal making activity involving India targeted the energy and power sector which totalled $13.1 billion in deal value, up 15.7% from a year ago, and captured 15.8% market share. Telecommunications and financials rounded out the top three industries with 13.1% and 11.8% market share, respectively. Morgan Stanley took the top spot for any Indian involvement in the M&A league tables during 2020, with $14.2 billion in related deal value, capturing 17.2% market share.

Similarly, in the ECM space, where the all-time high raise of $37.6 billion in 2020, was up 69.6% in proceeds from a year ago, Reliance Industries’ $7 billion rights offering in June became India’s largest-ever ECM offering, surpassing the previous record of ICICI Bank’s $4.6 billion follow-on offering back in June 2007. Refinitiv highlighted that a flurry of follow-on offerings totalling $32.9 billion, up 67.6% from last year, accounted for 67.6% of India’s overall ECM proceeds. The pandemic failed to dent the ECM records, as second and third quarter follow-on proceeds saw the highest quarterly period on record.

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