Stories
Indian Firms Need Global Brands & Outbound M&A to Attract International Investors: JPMorgan
- •JPMorgan's Anu Aiyengar states Indian companies, despite strong domestic growth and balance sheets, lack global relevance to attract international investors.
- •She argues that increased cross-border M&A and the creation of global brands are crucial for Indian large-caps to gain global visibility.
- •Outbound acquisitions, like the $11.75 billion Sun Pharma deal, should become more common, as Indian companies possess the financial capacity for large transactions.
- •Global M&A is surging due to strategic needs for scale, capabilities, and risk mitigation, even amidst geopolitical uncertainties and higher interest rates.
- •Aiyengar emphasizes that while domestic growth opportunities exist, global brands are essential to capture the imagination of international investors and achieve a rerating.
Key Questions Answered
According to Anu Aiyengar, Global Chair of Investment Banking at JPMorgan, while many Indian businesses have become large-cap companies due to strong domestic growth, they lack global relevance. Outbound mergers and acquisitions and global brands can help these companies capture the imagination of international investors and secure greater global visibility.
Anu Aiyengar cited the $11.75-billion Sun Pharma deal as an example of a major acquisition outside India. Such large-scale transactions should become more common because Indian companies now possess the strong balance sheets and financial wherewithal to pursue billion-plus deals.
Out of the $4 trillion of global M&A activity recorded in the first eight months of the year, approximately $1 trillion, or 25%, was cross-border activity. This growth persisted despite geopolitical tensions, conflicts, and protectionist regulatory environments.
