For years, India has been spoken of as a market on the brink of extraordinary private equity growth. That promise has now matured into reality. Global investors today view India as a core geography, not a peripheral bet. Policy clarity, market depth, and the willingness of Indian promoters to institutionalise have come together to create an environment that feels active, resilient, and increasingly sophisticated.
Cyril Shroff
Managing Partner
Cyril Amarchand Mangaldas
Mumbai
Tel: +91 22 2496 4455
Email: cyril.shroff@cyrilshroff.com
The face of corporate India has also changed in fundamental ways. What was once dominated by family-owned businesses and multinationals is now defined by private equity as a driving force.
Several factors are driving this shift: India’s infrastructure requirements, a vast consumer base, the expansion of financial services, and succession challenges that are prompting business families to consider exits or to cede operational control.
This is, however, only the starting point. Prime Minister Narendra Modi’s Viksit Bharat vision – a developed India by 2047, with a potential USD30 trillion economy – will demand unprecedented capital deployment.
PE is uniquely placed to play a catalytic role in that journey. It is not only about capital; it is about governance, operational depth, and strategic discipline. As India moves to deliver on this ambition, the scale of opportunity for PE investment is likely to be transformational.
2025 so far
Despite global uncertainties linked to the US elections and tariff actions, India’s PE market entered 2025 on solid ground. There is still significant dry powder, and the first two quarters have seen healthy activity across primary investments, secondaries and exits. Technology, consumer, financial services and healthcare continue to dominate sector allocations, underscoring where investors see long-term value.
New control lever
One clear sign of confidence among PE investors is the rise of platform transactions and control deals. For a long time, India was primarily a minority-investment market. That has shifted decisively. Control and co-control transactions are now centre stage, aided by investor comfort with regulations, a maturing legal framework and promoters who are increasingly willing to institutionalise their businesses.
Sponsors are seeking control positions to build scalable platforms, professionalise companies and execute bolt-on acquisitions. This approach aligns ownership with operational strategy. The growing viability of public market exits has added further momentum. For many global investors, an India allocation is no longer optional; it has become essential.
Regulatory framework
Aditi Manchanda
Partner
Cyril Amarchand Mangaldas
Mumbai
Tel: +91 22 2496 4455
Email: aditi.manchanda@cyrilshroff.com
Regulatory changes have played a crucial enabling role. In the past decade, most foreign investment in sectors has shifted to the automatic route, permitting either 100% foreign investment or automatic approval up to liberalised caps. Most sectors in India now permit 100% foreign direct investment under the automatic route, with only specific sectors requiring government approval for receiving foreign money.
Sensitive areas have also opened up: defence allows up to 74% automatically; space is between 49% and 100%, depending on the sub-sector; and telecom is fully liberalised. Insurance moved from 49% to 74% in 2021, and the government has proposed allowing 100% under specified conditions. This steady liberalisation has given foreign investors predictability and improved confidence in the Indian regulatory environment.
In addition to sectoral openings encouraging foreign investment, many recent targeted reforms will play a key role in how deals are structured and executed by both foreign and domestic investors.
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- Leveraged buyouts. In October 2025, the Reserve Bank of India (RBI) proposed introducing a framework more particularly in the listed space to allow Indian banks to fund acquisitions by domestic corporates. This is a meaningful development and if executed well, it could unlock structures that have historically powered buyout markets elsewhere.
- ODI and share swaps. Recent amendments to overseas direct investment (ODI) regulations under the Foreign Exchange Management Act now permit share swaps between residents and non-residents. This gives sponsors more flexibility in structuring inbound and outbound transactions and in reorganising platforms efficiently.
- Fast-track mergers. Recent changes to the Companies Act will expand the fast-track route to unlisted companies, holding-subsidiary mergers, and inter-subsidiary combinations. In practice, this simplifies integrations and restructurings – tools that are central to PE investment strategies.
- GST 2.0. Reforms announced in September 2025 streamlined tax slabs and reduced rates on more than 375 items. These changes are expected to lift EBITDA (earnings before interest, taxes, depreciation and amortisation) margins by 200 to 300 basis points in several sectors, making Indian businesses more attractive on both operational and valuation grounds.
While regulatory reform has brought increasing ease in regulation from respective regulators, regulators have been focusing more on enforcement, and companies continue to bear the onus of compliance. Regulatory bodies are becoming increasingly sophisticated and harmonised in tracking market activity.
In this context, director liability is a growing concern as directors receive notices. Safe harbour provisions for non-executive directors, as well as director and officer liability insurance, remain important safeguards for director liability protection.
Approvals and timelines
Saloni Shroff
Partner
Cyril Amarchand Mangaldas
Mumbai
Tel: +91 22 2496 4455
Email: saloni.shroff@cyrilshroff.com
Approvals continue to shape transaction timelines, although the landscape is evolving.
The Competition Commission of India (CCI) last year revised its notification thresholds, requiring filings for transactions exceeding INR20 billion (USD227.3 million), and where the target meets the substantial business operations test in India, in addition to the existing asset and turnover-based thresholds.
For matters that are grey areas and require clarity, pre-filing consultations with the CCI are being used more widely. CCI clearances for no-issues notifications are now completed within 30 to 45 days, giving dealmakers greater certainty.
RBI approvals for investments in NBFCs (non-banking financial companies) – change in control or in shareholding of 26% or more – have also become more structured. The applications are now made on a portal created by the RBI called Pravaah Portal.
While the RBI continues to seek detailed information, it has become far more engaged as the frequency of queries has increased. However, timelines have shortened in simpler cases, which is a noticeable shift from earlier years.
Press Note 3 approvals, required for investments from countries sharing a land border with India, initially created a lot of uncertainty. That regime has now stabilised. Several approvals have been granted, especially in the technology sector. The process has become more predictable, and further relaxations are expected soon.
IPO markets
India’s public markets have emerged as a reliable exit route. The Securities and Exchange Board of India (SEBI) has relaxed minimum holding periods for offer-for-sale components involving convertible instruments acquired through reverse flips, and amended promoter contribution rules to allow institutional shareholders to meet the 20% requirement.
In September 2025, the SEBI also proposed lowering the minimum public offer requirements for IPOs of more than INR500 billion, with extended timelines for achieving public shareholding. Collectively, these changes make IPOs faster and more flexible, sitting alongside secondary transactions and continuation fund strategies.
The road ahead
The most striking shift is in attitude. India is no longer seen as a frontier market. Global and domestic investors are now making long-term commitments across mid-market and control deals.
IPOs, secondaries and continuation funds are advancing in parallel, supported by a regulatory framework that, while still evolving, is far more stable and more predictable than it was a decade ago.
Private equity in India is now about maturity, not novelty. Sponsors are moving from observing growth to actively shaping it. The direction of travel is clear: private equity will not just finance India’s growth – it will help define it.
Cyril Amarchand Mangaldas
Peninsula Chambers, Peninsula Corporate Park,
GK Marg, Lower Parel,
Mumbai – 400 013, India.
Tel: +91 22 6660 4455
Email: cam.mumbai@cyrilshroff.com
www.cyrilshroff.com
