Welcome to the winter edition of India Watch, in association with the London Stock Exchange.
Each quarter, we track the performance of all Indian companies listed on the London Markets, while also giving an overview of Indian M&A activity and an analysis of the Indian economy. Read on for the summary highlights:
The Grant Thornton India Watch Index rose by 12.9% during Q4 2016, the fourth successive quarter of growth. Although growth slowed from its 38.4% rise in Q3, at the end of 2016 the Index closed 107.3% higher than at the end of 2015. We look at Q4’s winners and losers, including a sharp fall in the share price of Kolar Gold Limited and Vedanta Resources Plc seeing the biggest gain.
Dealmakers had a strong 2016, with US$62.5 billion of transactions, representing a 44% year-on-year increase in values – the highest for five years. We examine the heightened M&A activity, driven by a wave of consolidation and big-ticket transactions in the energy & resources, manufacturing and telecoms sectors, and look at the background to the drop in private equity (PE) activity, which saw its first decline in four years.
With a number of government reforms on the agenda aimed at stimulating growth in the economy, there is an optimistic outlook for 2017 and beyond. We consider the consequences of demonetisation, provide an update on the proposed Goods and Services Tax (GST), and look at the latest inflation and export data.
Brexit is likely to affect Indian investor sentiment into the UK although it’s too early to say exactly how and to what degree. While some specific sectors and businesses are likely to suffer, others may feel no change at all. The precise terms of departure will be important, as will the speed with which a UK-India bilateral trade agreement can be agreed.