November 28, 2023

Investment Banking

Let Your Investment Banking Do The Walking

Kotak Plans to Hire 20 Investment Bankers in Bet on M&A Recovery

(Bloomberg) — Kotak Mahindra Bank Ltd.’s investing banking arm is planning to expand its operation by hiring about 20 bankers, betting on a rebound in deals activity next year.

The addition would mean a 25% increase to its current 80-strong investment banking unit, according to S Ramesh, managing director and chief executive officer of Kotak Investment Banking. The firm is looking to fill positions from analyst to director levels across sectors including financial services, health care and technology, where overseas companies such as Inc. and Walmart Inc. may search for investment opportunities, he said. Electric vehicles and renewable energy could also draw interest.

“We expect global strategic companies to start firing the engine to consolidate their businesses in India across diversified sectors,” Ramesh said in an interview in Mumbai. “We expect the 2023 M&A volumes to overtake that of 2022.”

India saw $168 billion worth of pending and completed deals so far this year, and is heading for an annual record, according to data compiled by Bloomberg. The surge was dominated by HDFC Bank Ltd.’s $58 billion all-stock purchase of Housing Development Finance Corp. Gautam Adani, India’s wealthiest person and the world’s third-richest, spearheaded a $10 billion acquisition of Holcim AG’s local cement business, the country’s second largest deal of the year.

Another factor that could drive deal flow in India is financial investors that are willing to write larger checks for acquisitions, Ramesh said. New generations leading family-run businesses are also more willing to sell, while conglomerates are looking to consolidate in order to position themselves for future growth, he added.

On the initial public offering front, Kotak Investment Banking expects as much as 750 billion rupees ($9 billion) could be raised in 2023. Companies have raised about $5.8 billion through first-time share sales in the year to date in India, led by Life Insurance Corp. of India’s $2.7 billion offering, according to data compiled by Bloomberg.

“I expect 2023 to be a much better year for IPOs, driven by peaking of interest rates hikes, inflation and local pools of money coming into Indian offerings,” Ramesh said. “India has the potential to stand out amid the global headwinds.”

Kotak Investment Banking offers services including equity and debt capital market issuance, M&A advisory and private equity advisory, according to its website. The firm advised KKR & Co. on a $1.1 billion block trade of a stake, held through an affiliate, in India’s largest hospital chain Max Healthcare Institute Ltd. Kotak was also among the 10 advisers managing the LIC IPO in May, which was the biggest ever in India’s history.

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