NEW DELHI: India's financial services sector demonstrated remarkable resilience in the third quarter of 2025, with a surge in high-value deals propelling it to its highest quarterly value in over a year, according to a report by Grant Thornton Bharat.
The Q3 2025 Financial Services Dealtracker has revealed that the sector recorded 61 deals worth $7.8 billion. While the number of deals fell by 23% compared to the previous quarter, the total value witnessed a significant 39% increase, marking the strongest quarterly performance since Q1 2024.
This growth was primarily driven by three blockbuster billion-dollar transactions: a $1.3 billion stake acquisition by Sumitomo Mitsui Banking Corporation in Yes Bank, a $1.5 billion IPO by HDB Financial Services, and a large Qualified Institutional Placement (QIP) by the State Bank of India (SBI). These mega-deals underscore sustained confidence from major institutional investors in the Indian market.
"Q3 reflects the current dichotomy in India and global markets," said Vishal Agarwal, Partner, Private Equity Group and Deals Tax Advisory Leader, Grant Thornton Bharat.
"While overall deal volumes softened, long-term strategic investments, uptick in QIP and IPO activity and fintech innovation highlight sustained investor confidence."
M&A activity saw a slight 6% rise in volume with 17 deals, but their total value plummeted by 44% to $1.5 billion, largely due to the absence of large-ticket transactions seen in the prior quarter.
The PE landscape experienced a downturn, with both deal volume and value declining by 33% and 37%, respectively. The market was dominated by smaller, early-stage investments, with 83% of deals being under $50 million, reflecting a cautious investor sentiment.
Public markets were the standout performers, staging a strong rebound. Three IPOs raised $2 billion, while three QIPs brought in a substantial $3.1 billion, indicating robust investor appetite for large-scale capital raising.
Fintech leads in volume, banking in value
The Fintech sector was the most active, accounting for 26 deals, or nearly half of all transactions. However, these were predominantly small-ticket investments, with the sector's total value declining by 38%.
In contrast, the Banking & NBFCs sector dominated in terms of value, contributing a massive USD 2 billion, or 77% of the total deal value for the quarter. This was driven by a few high-value transactions, including the billion-dollar Yes Bank deal.
The report concludes that despite a global climate of uncertainty, India's financial services sector remains attractive for strategic, long-term capital, with public markets and established banking institutions leading the charge while fintech continues to be a hotbed for investor interest.
