Indian Technology Sector Sees Surge in Deal Values in Q3 2023
The Indian technology sector has witnessed a significant boost in deal values, with a total of 87 deals amounting to $1.4 billion in the third quarter of this year, according to a report released on Thursday. This marks a 40% increase in values compared to the previous quarter. However, the deal volumes experienced a decline of 13% in the July-September period.
The rise of generative AI is playing a crucial role in reshaping the industry. Prominent tech players are actively embracing and leveraging this technology to enhance efficiency across various sectors, the report Grant Thornton Bharat stated.
Raja Lahiri, Partner and Technology Sector Leader at Grant Thornton Bharat, emphasized the need for the tech industry to re-evaluate investment strategies. He highlighted the importance of focusing on innovation in areas such as spacetech, SaaS, AI, and cloud in order for investors to navigate the evolving landscape.
In terms of the mergers and acquisitions sector, the third quarter witnessed 20 deals valued at $882 million, reflecting a 9% decline in volumes compared to the previous quarter. However, there was a substantial 573% increase in deal values.
Several notable deals took place in the tech industry during this period. MapMyIndia invested $1.1 million in Mappls KOGO, an AI-driven travel advisor. Agritech start-up Leads Connect secured $60.2 million from BL Agro Industries. The Proximus Group’s acquisition of a majority stake in Route Mobile for $721 million marked the largest deal in the SaaS market, according to the report.
Within the private equity (PE) landscape, the technology sector experienced a marginal decline in deals. A total of 67 transactions amounting to $564 million were recorded, reflecting a 14% decrease in volumes and a 37% decline in deal values compared to Q2 2023.
Notable investments in the technology startup segment include Nazara Technologies receiving funding of $62.2 million from SBI mutual fund schemes. Perfios also secured a substantial investment of $229 million from Kedaara Capital, marking one of the largest B2B SaaS deals of the year. Additionally, there were three IPOs in the IT sector collectively valued at $253 million during the period.