Synopsis: Citigroup plans to expand its investment banking team in India, expecting a surge in equity capital market (ECM) and M&A deals. Rahul Saraf, managing director and head of India's investment banking unit, announced a significant headcount increase over the next year.
Citigroup plans to expand its investment banking team in India, anticipating a surge in equity capital market (ECM) and merger & acquisition (M&A) deals in one of the world's fastest-growing economies, according to a top executive.
"We haven't finalized the numbers yet, but we expect a significant increase between this year and next year," said Rahul Saraf, managing director and head of the India investment banking unit, which currently employs around 30 dealmakers, in an interview with Reuters.
India has seen a sharp rise in equity deals, making it a standout in an otherwise sluggish Asian market.
It is now the second busiest market globally for ECM deals after the United States and ranks third in IPOs for the first half of 2024.
This momentum is expected to continue, with South Korean automaker Hyundai Motor's India unit planning a $3-billion IPO and SoftBank-backed Ola Electric aiming to raise $660 million in a stock market trading near record highs.
Citi has advised on $6.3 billion worth of ECM deals and $7.9 billion worth of M&A transactions in India so far this year, according to Dealogic data, placing it ahead of Wall Street rivals Morgan Stanley, Goldman Sachs, and JP Morgan.
Last week, Citigroup, the third largest U.S. lender, exceeded Wall Street expectations for second-quarter profit, driven by a surge in investment banking, markets, and services revenue.
Investment banking fees soared 60% in the second quarter to $853 million.
For the rest of 2024, Citi India anticipates numerous M&A and ECM deals, potentially totalling up to $20 billion, which would help it achieve record deal volumes and market share as an advisor, Saraf said.
He added that 25-30 mid-sized firms could go public locally over the next two years.
In conclusion, Citigroup's plan to expand its investment banking team in India underscores its confidence in the country's robust equity capital market and M&A activity.
With India emerging as a key player in global equity deals, Citigroup aims to capitalize on this momentum, having already led significant transactions this year.
The anticipated influx of deals and potential IPOs will likely bolster Citigroup's market share and solidify its position as a leading advisor in India's fast-growing economy.
