India's automotive sector recorded $717 million worth of deals during the April-June quarter of 2026, marking the lowest quarterly transaction volume in three years. According to Grant Thornton Bharat's latest Automotive Dealtracker, the sector witnessed 20 mergers and acquisitions (M&A), private equity (PE) and public market transactions during the quarter. While deal volumes declined from the preceding quarter, total deal value fell by just 4 per cent sequentially, indicating that investors continued to back fewer but larger, high-quality transactions. As Grant Thornton Bharat Partner and Auto & EV Industry Leader Saket Mehra noted, "While deal activity slowed during the quarter, investment remained focused on businesses driving the future of mobility."
Excluding public market activity, the sector recorded 18 M&A and PE/VC deals worth $479 million, with investments concentrated in mobility platforms, automotive technology companies and EV ecosystem players. As reported by Grant Thornton Bharat, investment remained focused on businesses driving the future of mobility, with investors becoming more selective and backing companies that have demonstrated scale, differentiated capabilities and a clear growth path. The trend reflects sustained investor confidence in scalable mobility platforms and businesses driving the next phase of electrification. According to Mehra, "We are seeing continued interest in EVs, mobility platforms and automotive technologies, with investors becoming more selective and backing companies that have demonstrated scale, differentiated capabilities and a clear growth path. As the sector evolves, technology-led investments are expected to continue shaping deal activity."
M&A activity remained selective with five deals worth $138 million during the quarter, according to Grant Thornton Bharat. The biggest acquisition was KPIT Technologies' $120-million purchase of Israel-based Cymotive Technologies, underscoring the growing strategic importance of automotive cybersecurity, software-defined vehicles and connected mobility. Despite lower deal volumes, average deal sizes increased significantly as companies prioritised technology-led capability building over scale-driven expansion. As Grant Thornton Bharat noted, "Despite lower deal volumes, average deal size increased significantly, reflecting a focus on high-value, technology-driven transactions." Auto Tech accounted for 87 per cent of M&A value, highlighting growing strategic investments in software, cybersecurity and connected mobility capabilities.
Private equity and venture capital activity also moderated with 13 deals worth $341 million, as reported by Grant Thornton Bharat. Funding remained concentrated in a handful of large transactions, led by Rapido's $240-million fundraise, the largest deal of the quarter, followed by JBM Ecolife Mobility's $47-million investment. Mobility-as-a-Service emerged as the largest segment by value, attracting $298 million of investments, while EVs accounted for 54 per cent of PE deal volumes, highlighting continued investor interest in India's electrification ecosystem. The trend highlights sustained investor confidence in businesses driving the next phase of mobility and electrification.
According to Grant Thornton Bharat, the top five PE transactions accounted for nearly 96 per cent of total PE investment value during the quarter, reflecting investors' preference for category-leading companies with demonstrated scale and clearer growth prospects in a tighter funding environment. PE/VC activity moderated during the quarter, recording 13 deals worth $341 million, with investors remaining selective amid a challenging funding environment. Capital continued to flow towards scalable mobility platforms and the EV ecosystem, as investors prioritised technology-led capability building over scale-driven acquisitions. The selective investment approach indicates a maturing market where capital flows toward technology-led businesses with proven capabilities in the evolving automotive landscape.
