India investment banking fee in Jan-Mar quarter falls to lowest since 2016: Refinitiv

ECM (equity capital markets) underwriting fees reached $40.9 million, down 43.2% from a year ago, the report said, while DCM (debt capital markets) underwriting fees totaled $49.1 million, down 23.9% from a year ago – the lowest start to a year since 2016. Completed M&A advisory fees fell 17.9% from a year ago and totaled $62.2 million, while syndicated lending fees declined 52.5% from the comparable period last year and generated $27.4 million in the first quarter of 2022.

“While global deal making fell to its lowest opening period since 2020, the start of the Covid-19 pandemic, M&A activity involving India witnessed a strong start as first quarter period reached a four-year high. The acquisition of technology and healthcare, availability of private equity and abundant cash reserves as well as historically low interest rates, were key factors pushing M&A growth so far this year,” said Elaine Tan, senior analyst at Refinitiv, an LSEG Business.

 “High Technology acquisitions involving India accounted for majority of the market share with 22% and totaled $6.6 billion, double the amount from a year ago, saw the strongest-ever start to a year for the sector. Private equity deals targeting Indian companies also kicked off at a record pace and amounted to $9.8 billion, with high technology sectors capturing the majority of the activity with 28.7% market share. With India’s strong innovative start-up economy, deal making in the technology and technology-adjacent sectors, could continue to drive activity, despite current challenges brought by market volatility fueled by geopolitical tensions,” added Tan

Worldwide IPO activity has slowed considerably amidst market volatility and world conflict, the report noted.

“In line with the global trend, India’s IPO activity declined 57.1% in proceeds after witnessing a record start last year, and the number of IPOs fell 14.8% year-on-year.  Despite a healthy pipeline, including the anticipated upcoming IPO from Life Insurance Corp (LIC), the cloudy landscape as well as the tightened scrutiny on Indian IPOs could dampen activity,” said Tan.