Indian billionaires buy foreign companies as growth slows at home

Indian companies are accelerating their acquisitions of foreign businesses and expanding operations abroad as economic growth slows in their domestic market. The trend is highlighted by Sun Pharmaceuticals' agreement in late April to acquire the New York-listed women's health and biosimilars firm Organon & Co. for $11.75 billion (£8.59 billion). This transaction represents the largest overseas acquisition by an Indian company in nearly two decades.

The Sun Pharmaceuticals acquisition follows a series of other major international deals by Indian firms. These transactions include Tata Motors' $4.4 billion acquisition of the Turin-based vehicle manufacturer Iveco, IT company Coforge's $2.35 billion purchase of Silicon Valley-based artificial intelligence firm Encora, and the Bajaj Group's purchase of a 23 percent stake in global insurance firm Allianz SE in early 2025.

Data compiled by the consultancy Grant Thornton indicates that 162 Indian companies spent more than $18 billion on outbound acquisitions in 2025, representing a 34 percent increase from the prior year. Sumeet Abrol, partner and national leader at Grant Thornton, stated that outbound deal values could exceed $15 billion in the first half of the year alone.

While earlier acquisition waves in the 2000s were driven by a strong domestic bull market and global ambitions—such as the Tata Group's purchases of Jaguar Land Rover and Corus Steel—analysts state that current motivations are primarily strategic and operational. Today, India is grappling with a rapid departure of foreign portfolio investors, a sharp deceleration in net foreign direct investment, and weak private sector investment, despite government tax cuts and production-linked subsidies.

"Corporate profits grew at 30.8% per annum. But still, our overall capital formation rates from the private sector have been disappointing," India’s Chief Economic Advisor V Anantha Nageswaran recently remarked at a policy conference.

Analysts point to growing dissatisfaction with the domestic business climate alongside better opportunities for diversification and capacity-building abroad. Saurabh Mukherjea of Marcellus Investment Managers noted that several companies are choosing to establish greenfield factories in foreign markets like the United States, where industrial land is highly accessible and working capital is easier to secure.

"There is plenty of Indian money heading abroad. Even among the companies that we own in our portfolio, many are setting up greenfield factories in the US and other places where industrial land is almost free and accessing working capital is much easier than here," Mukherjea said.

In addition to major transactions, smaller Indian companies are pursuing similar greenfield investments and minor acquisitions. Stronger corporate balance sheets and improved access to global financing have supported this trend.

Neha Singh, co-founder of data intelligence company Tracxn, explained the shift: "Indian companies are increasingly looking overseas to access markets, brands, technology capabilities, R&D expertise, and established distribution networks that may otherwise take years to build organically." Singh added that overseas expansion is expected to be paired with "selective caution" regarding large domestic investments.

Supply chain protection amidst rising trade tariffs and geopolitical chokepoints is another key driver for these acquisitions. However, funding structures remain a challenge. Unlike global peers, Indian companies are still unable to use shares to pay for foreign acquisitions, meaning even large-scale deals like the Sun Pharmaceuticals acquisition must be completed entirely in cash, which carries higher financial risk.

Mukherjea also pointed out that next-generation corporate leaders, many of whom study and reside abroad, increasingly prefer holding assets in foreign currencies. He noted that the Indian rupee historically loses approximately 40 percent of its value against the U.S. dollar every decade.

Future outbound transaction volume could be further accelerated by a series of free trade agreements currently being negotiated or finalized between India and partners such as the United Kingdom, Europe, and Australia. However, short-term activity remains subject to geopolitical uncertainties.