India's consumer retail saw deals worth USD 3.1 billion in Q32024: Grant Thornton

New Delhi [India], October 18 : India's consumer retail sector is poised for continued growth as it saw 123 deals valued at USD 3.1 billion in the third quarter of 2024, driven by rapid expansion of quick commerce and direct-to-consumer brands, Grant Thornton said in its latest report.
Since Q3 2023, the consumer and retail sector has led the way in driving overall deal activity, accounting for 20 per cent of the total volumes in Q3, and the quarter witnessed the highest level of activity in the past two years.
Mergers and acquisitions (M&A) activities recorded the highest quarterly deal volumes since Q1 2022, while the values of these deals witnessed a 26 percent increase over the previous quarter. However, the report added that M&A and Private Equity (PE) deal values declined 9 percent from Q2 2024, primarily due to non-disclosed M&A deal values and small-ticket PE transactions.
Interestingly, the small-ticket transactions in the PE space dominated the transaction, impacting overall deal values.
The M&A activity in the space saw 31 deals valued at USD 629 million in the third quarter.
The deal value rose 36 per cent from USD 462 million in the second quarter of 2024 to USD 629 million. Domestic M&A led the activities led the activity with 90 per cent share in the volume and 97 per cent shares in the value term.
The Cross border activity maintained a steady volume but saw a 94 per cent decline in value. The top M&A deal during the quarter was Zomato Media Pvt Ltd's acquisition of Paytm - Wasteland Entertainment Pvt Ltd and Orbgen Technologies Pvt Ltd for USD 247 million.
Commenting on the outcomes of the findings, Naveen Malpani, Partner, Grant Thornton Bharat, "India's consumer and retail sector is poised for continued growth, driven by the rapid expansion of quick commerce and direct-to-consumer brands. In the last quarter, the sector accounted for 20 per cent of total volumes, leading deal activity since Q3 2023. 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."
The PE activities marked the second quarterly deal volumes in the last two years and the second-highest quarterly values for the year. Small ticket deals (10 million) dominated PE volumes with a 70 per cent share in deal volumes while only contributing to an 11 per cent share in values, as per the report.
The quarter witnessed seven IPOs, with four of them valued above USD 100 million ticketsize each. Notably, Brainbess Solutions emerged as the biggest IPO in the sector since Q2 2022, raising USD 505 million. Additionally, Quality Improvement Programme (QIP) activity increased from just one deal worth USD 72 million in Q2 2024 to four deals worth USD 173 million this quarter, the report added.