M&A during previous economic crises significantly altered the corporate landscape in India.

The coronavirus pandemic of 2020 has compelled countries across the world to implement quarantines and social distancing measures. An estimated 50 percent of the world’s population has been placed under some form of lockdown for several weeks. This Great Lockdown of 2020 has caused severe economic repercussions, and the consequent slowdown is already regarded by many as the worst economic downturn since the Great Depression.

Indian capital markets and M&A activity have been adversely impacted by the Great Lockdown. Albeit different in magnitude and consequences, a study of performance during previous disruptions provides interesting takeaways.

In the last two decades, India has weathered two global crises in the form of the bursting of the dot-com bubble (2000) and the Global Financial Crisis (2008), as well as a significant localized economic disruption in the form of demonetization (2016). For each disruption, we examine the performance of the Indian economy and analyze the performance of equity capital markets during the period. Further, we study M&A deal activity in the period to discover the key trends observed. Finally, our report comments on the success/failure or the transformational nature of deals studied.

We observed that similar M&A themes of non-core business sales, deleveraging, consolidation and, in some instances, government divestments occurred across market disruptions. Some corporates were able to take advantage of the environment through transformational acquisitions that helped them secure market-leading positions.