India Inc goes on M&A spree despite pandemic in 2020, New year will be brighter
Published On: Thursday, December 31, 2020 | By: Team KnowMyStock
Indian conglomerates bought and sold companies in record-breaking deals despite a majority of smaller firms ending the year on a dull note. Many corporate India is ending 2020 with battered sales and profits due to the pandemic while a few top companies saw a phenomenal rise in their market valuation. The year 2020 will be remembered for the billions of dollars’ worth of investments reported by Reliance Industries by selling a stake in its telecom services arm, Jio Platforms. As soon as the Mukesh Ambani-led firm stopped selling stakes in Jio, global investors queued up to invest in its organised retail arm, making the company virtually debt-free. Backed by billions of dollars of investments from marque global investors, Ambani then acquired Future group’s entire retail and wholesale business for Rs 25,000 crore, giving the group a significant lead in organised retail.
While Ambani is now focusing on consolidating his empire in 2020, Gautam Adani, chairman of the Adani group, was busy setting up new businesses during the year.
The group invested in picking up six airports after an auction by the government and acquiring the debt of GVK in Mumbai airport. The group is also investing heavily in renewable energy in a big way and is expecting electricity prices to fall substantially as more renewable power is supplied to the grid.
The Tata group, meanwhile, is expecting to start the new year with big bang acquisitions of Air India, online retailer, Big Basket, and Cafe Coffee Day. This will be apart from Tata Sons increasing its stake in Air Asia India.
The Aditya Birla Group, which is struggling with its telecom venture, is also expected to make way for distressed funds to buy stakes in Vodafone Idea Ltd where it made huge losses. At the same time, while the Jindal group ended the year waiting for approvals to acquire Bhushan Power and Steel for Rs 19,700 crore, the Vedanta group put in a bid for Bharat Petroleum that will cost it as much as Rs 50,000 crore in the new year if its bid succeeds.
In the new year, we can expect top groups to make big time investments in the healthcare and wellness segment which remained unaffected during the pandemic.
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