India's auto deals hit $4.6 bn in Q3, driven by outbound M&A, EV growth

Excluding the Tata Motors transaction, deal values fell 36 per cent quarter-on-quarter (Q-o-Q), indicating that large strategic bets continue to drive overall momentum

India’s automotive sector recorded its strongest quarter in over a year, with 30 transactions valued at $4.6 billion, according to Grant Thornton Bharat Q3 2025 Automotive Dealtracker.

 

While deal volumes remained consistent with the previous quarter, values surged sharply. It was largely driven by Tata Motors’ $3.8-billion acquisition of Iveco SPA, marking one of India’s largest outbound automotive transactions to date.

 

Excluding this deal, values fell 36 per cent over the last quarter, signalling that large strategic bets continue to define overall deal momentum. 

 

The quarter reflected a strategic pivot towards global expansion, electrification, and supply-chain recalibration, as both strategic acquirers and private investors intensified focus on future-ready mobility platforms, the report said.

   

While merger and acquisition (M&A) activity was dominated by cross-border consolidation plays, private equity (PE) interest remained steady in scalable, tech-enabled segments, such as electric mobility, fleet electrification, and Mobility-as-a-Service (MaaS).

 

“The Indian automotive sector is in a phase of strategic reset — balancing policy reform, consumer realignment, and global expansion. The rollout of goods and services tax (GST) 2.0 and targeted tariff interventions have set the stage for renewed demand. This comes even as original equipment manufacturers (OEMs) and investors pivot towards cleaner, smarter mobility solutions,” said Saket Mehra, partner and automotive industry leader, Grant Thornton Bharat.

 

He added, “The quarter’s strong M&A and PE activities reflect India’s growing global ambition in commercial mobility and a clear shift towards scalable, tech-enabled platforms. As policy tailwinds and festival demand converge, we anticipate sustained momentum across alternative fuel technologies, auto-tech, and supply-chain digitisation.”

 

Mergers and acquisitions (M&A) landscape:

 

M&A activity surged in Q3 of 2025, with seven deals valued at $ 4.1 billion. This marks a 13 per cent decline in volumes but a 1,234 per cent increase in value over Q2.

 

Cross-border deals accounted for 71 per cent of volumes and 99 per cent of total values, with Asia and Europe being key regions of activity.

 

Samvardhana Motherson International executed three outbound acquisitions during the quarter, reinforcing India’s role in global auto supply chains.

 

The top M&A deal was TML CV Holdings PTE Ltd’s acquisition of Iveco SPA for $3.7 billion, which contributed 95 per cent of the total M&A value. It underlined India’s strategic global ambitions in the commercial mobility space.

 

PE landscape

 

PE activity remained strong, with 23 deals worth $531 million, marking a 15 per cent increase in volumes but a 17 per cent drop in values compared to Q2.

 

The decline in value reflects the absence of large-ticket transactions, as 70 per cent of deals were below $10 million, underscoring investor preference for smaller, focused bets.

 

MaaS continued to dominate PE deal flow, accounting for nearly 80 per cent of the total value, led by Rapido’s $271 million investment from Prosus and WestBridge Capital.

 

IFC-backed funding in electric bus operators JBM Ecolife Mobility and GreenCell Mobility were together worth $137 million. It further reinforced investor confidence in urban electrification and multimodal transport infrastructure.

 

IPO, QIP landscape

 

Public market activity remained subdued in Q3 of 2025, with no major initial public offering (IPO) and qualified institution placement (QIP) seen.

 

However, investor focus remains high on the anticipated Toyota IPO in 2026, which is expected to reshape investment flows and reinvigorate sectoral interest.

 

The preference for private capital and strategic consolidation continued to dominate funding trends this quarter.