In Short:
Citigroup expects a strong year in 2024 for equity capital markets and mergers and acquisitions in India, following Hyundai Motor India’s massive IPO. Senior officials highlighted a solid pipeline of transactions, encouraging global MNCs to consider listings. Activity spans various companies, with a rise in substantial outbound M&As predicted. Positive trends, despite geopolitical risks, indicate a flourishing Indian market.
Bright Prospects for Citigroup in India
Citigroup is poised for a remarkable year in 2024 as it anticipates a flurry of activities in both equity capital markets and mergers and acquisitions (M&As). This optimism follows the impressive debut of Hyundai Motor India, which marked the nation’s largest initial public offering (IPO).
Positive Outlook Ahead
Senior officials from Citi expressed a positive sentiment during a recent media briefing, noting that the momentum of this activity is expected to continue into 2025 and beyond. They emphasized that the current pipeline of transactions is considerably stronger than last year, showcasing Citi’s prowess in advising on public market issuances and M&As.
A Glimpse into the Future
Despite what some might view as a disappointing market reaction to Hyundai Motor India‘s listing, there remains a substantial interest from global multinational corporations in exploring opportunities in India. Rahul Saraf, Citi’s Head of Investment Banking in India, shared, “We have numerous large MNC clients eager to tap into this potential. The listing of Hyundai seems to have ignited their enthusiasm.”
Market Resilience
Even with the considerable $3.3 billion size of the IPO not significantly swaying the markets, Arvind Vashistha, the Head of Equity Capital Markets for India, noted that it signals the market’s capability to handle “jumbo transactions.” He mentioned that the overall quality and sophistication of transactions in India is on the rise, and this trend appears to be here to stay.
An Increase in Outbound M&As
Interestingly, the activity in M&As isn’t limited to just a few large players. Saraf pointed out an upward trend in outbound M&As expected next year, highlighting an increase in the size of transactions. “This is exciting for us as we can engage more meaningfully in sizeable transactions, particularly those exceeding $500 to $750 million,” he noted.
Recent Highlights
Besides the standout Hyundai IPO, Citigroup has been actively involved in several significant deals, including:
- The recent CD&R-Sanofi Consumer Healthcare India transaction
- BAT Plc‘s selldown in ITC
- TCS‘s selldown for Tata Sons
- The upcoming IPO of Swiggy
- Reliance Industries‘ acquisition of Star India
- Brookfield‘s acquisition of American Tower’s assets in India
Overall Market Dynamics
Despite various external challenges such as geopolitical tensions, fluctuating commodity prices, and interest rates, Vashistha reassured that the market is resilient. He attributed the ongoing IPO boom in India to robust economic growth, increasing earnings, and expanding investor participation across the board.
