The January-June period of 2021 saw 20 per cent rise in deals to a record high of $43 billion besides creation of 10 new unicorns, despite the devastating second wave of the pandemic, according to a report.
The period saw completion of 856 deals worth $43 billion with an average deal size of $50 million, the report by Grant Thornton said.
While in volume terms, it is 42 per cent more than the year-ago period's, in value terms is is higher by 20 per cent over last year, which is a record, it said.
The private equity inflows into the tech space saw 10 new unicorns being created during the first half (H1) of 2021. Of these, five are from the e-commerce space, taking the overall tally well past 100 in the country.
The deal street was led by higher number of private equity deals and 221 merger and acquisitions (M&As) aggregating to $24.4 billion, which is 36 per cent higher than that in H1 of 2020.
The Adani Group has been one of the most active acquirers with the acquisition of five companies above $200 million value.
Domestic M&As accounted for 76 per cent of the M&A volume, making it the highest in the past 11 years. In contrast, cross border saw lowest deal volumes over the past decade.
In H1, the banking and financial services sector emerged as the second-highest contributor to deals after the energy and natural resources sector, wherein the Adani Group has been the key player.
The deal tally was led by Piramal Capital acquiring Dewan Housing Finance for $5.1 billion under the Insolvency and Bankruptcy Code, making it the largest M&A deal in H1.
There were 44 deals worth $2.5 billion in the tech space making it the most active sector. Key driver of M&A in this sector was Wipro's acquisition of Capco for $1.45 billion.
The period also saw the world's largest edtech acquisition with Byju's acquiring Aakash Educational Services for $1 billion.
Another major highlight was Tata Group inking a $1.2 billion deal to buy Bigbasket, the largest e-grocery player.
The H1 saw 635 PE deals amounting to $18.5 billion, compared to 440 deals worth $17.6 billion in H1 2020. Over 50 per cent of PE and venture capital (VC) deals were into e-commerce, e-gaming, consumer tech, health tech, ed-tech and fintech sectors.
Blackstone's additional investment into Mphasis, and others investments in Swiggy, Byju's, Dream 11, FirstCry, Mesho, Infra.market etc, as well as NIIF's investment into Manipal Hospitals and multiple PEs buyout of Zydus Cadila's animal health business, made the sector very active.
Deal momentum continues to be robust driven by PE and VC deals which are evidently led by new-age sectors such as technology, digital, e-commerce, etc, the report said.
This had 10 startups like Digit Insurance, BrowserStack, Zeta, Moglix and Urban Company among others joining the league with giants like Byjus, Oyo, Zomato, Ola.
Capital is pivoting to these new-age businesses and environmental, social and corporate governance (ESG) theme will continue to grow bigger in deal themes, the report said.
Inbound deals declined 30 per cent in volumes and 25 per cent in value (excluding Facebook-Jio deal valued at $5.7 billion in H1 2020 and 69 per cent plunge including this deal).
The outbound deals saw only 31 transactions, marking the lowest deal volumes for the six-month period since 2011.