India’s Consumer And Retail Sector Leads Deal Activity In Q1 2025: Grant Thornton Report

India’s consumer and retail sector recorded a major comeback in the first quarter of 2025, logging its highest deal volume in three years, according to a new report by Grant Thornton Bharat.

This uptick reflects a broader recovery in private equity (PE) and mergers and acquisitions (M&A) activity across the country.

The sector closed 139 deals totaling $3.8 billion, marking a 65% increase in volume and a 29% rise in value compared to the previous quarter.

This surge positioned the consumer and retail sector as the most active industry by deal volume for the quarter.

According to the report, a combination of multiple small-ticket transactions and two billion-dollar deals fueled this impressive performance.

Temasek And Wilmar Drive Mega Deals

The two headline-making transactions included Temasek’s $1 billion acquisition of a 10% stake in Haldiram’s, the largest packaged food deal in India’s history.

In another major move, Singapore-based Wilmar International acquired the staples business of Adani Wilmar for $1.44 billion.

Together, these two deals accounted for more than 75% of the sector’s total deal value for the quarter.

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“Private equity investments were spread across multiple sectors, with consumer and retail taking the lead—28% of deal volume and 18% of deal value,” said Shanthi Vijetha, partner, due diligence at Grant Thornton Bharat.

The overall PE/VC (private equity/venture capital) activity in India also surged during the quarter.

Investors closed 408 deals worth $8.6 billion, a 66% increase in value from the previous quarter and the highest value recorded in 11 quarters.

The report highlighted that segments such as e-commerce, fast-moving consumer goods (FMCG), textiles, apparel, accessories, and personal care collectively drove 63% of total deal volume.

However, the average deal size declined, dropping to $27.2 million, down from $34.8 million in the previous quarter.

Cautious Optimism Amid Market Headwinds

Despite the upbeat deal activity, analysts remain cautious.

“A muted sentiment in India’s capital markets suggests that valuations need to reach more realistic levels to rekindle broader investor interest,” said Vishal Agarwal, partner and private equity group and deals tax advisory leader at Grant Thornton Bharat.

He also noted that uncertainty in global markets, especially around potential US tariffs, may cause investors to adopt a wait-and-watch approach in the coming weeks.

While macroeconomic uncertainty lingers, India’s consumer and retail sector has clearly emerged as a hotspot for dealmaking in early 2025.

With investor focus shifting toward resilient domestic demand and essential goods, analysts expect continued momentum provided valuations stabilize and global risks ease.