India’s consumer retail sector continues to demonstrate robust growth, with 123 deals valued at USD 3.1 billion recorded in the third quarter of 2024, according to a report by Grant Thornton. This surge was largely driven by the expansion of quick commerce and direct-to-consumer brands, reinforcing the sector’s position as a major player in deal activity.
Since Q3 2023, the consumer and retail sector has led deal volumes, accounting for 20% of the total transactions in Q3 2024. The quarter marked the highest level of activity in the past two years, particularly in mergers and acquisitions (M&A), which saw the largest deal volumes since Q1 2022. Deal values increased by 26% over the previous quarter.
However, the report noted a 9% decline in M&A and Private Equity (PE) deal values compared to Q2 2024. This was attributed to non-disclosed M&A deal values and the predominance of small-ticket PE transactions. Despite this, small-ticket PE transactions dominated the overall deal volumes.
M&A and PE Activity Overview
M&A activity recorded 31 deals valued at USD 629 million, a 36% rise from the USD 462 million reported in Q2 2024. Domestic M&A led the charge, contributing 90% of the volume and 97% of the value. Cross-border activity remained steady in volume but saw a sharp 94% decline in value.
The top M&A deal of the quarter was Zomato Media Pvt Ltd’s acquisition of Paytm – Wasteland Entertainment Pvt Ltd and Orbgen Technologies Pvt Ltd for USD 247 million.
Positive Outlook for Sector Growth
Naveen Malpani, Partner at Grant Thornton Bharat, expressed optimism about the future of the consumer retail sector. “As we head into the festive season, we expect a significant surge in sales, reinforcing investor confidence and solidifying the sector’s potential for innovation and scalability,” he said.
The PE segment recorded the second-highest quarterly deal volumes and values in the past two years. Small-ticket deals (below USD 10 million) dominated with a 70% share in volumes but contributed just 11% to total deal values.
Additionally, the quarter saw seven IPOs, with four of them valued above USD 100 million. Brainbess Solutions stood out as the biggest IPO since Q2 2022, raising USD 505 million. Quality Improvement Programme (QIP) activity also saw a boost, increasing from one deal worth USD 72 million in Q2 2024 to four deals totaling USD 173 million in Q3 2024.
