Indian companies are hedging against the uncertainties of home.
Something has shifted in the ambitions of Indian enterprise. In 2025, 162 Indian companies spent $18 billion acquiring foreign businesses — a 34 percent surge — led by Sun Pharmaceuticals' $11.75 billion purchase of Organon, the largest such deal in nearly two decades. Where earlier generations bought abroad for prestige, today's acquisitions are quieter and more purposeful: technology, supply chains, brands, and resilience against a world of rising trade barriers. The movement outward reflects not triumph but a kind of reckoning — with slowing growth at home, a depreciating currency, and a private sector that has profits but not confidence.
- India's domestic investment engine has stalled even as corporate profits soared 31% annually post-pandemic, creating a paradox that is pushing capital toward foreign shores.
- The $11.75bn Sun Pharma–Organon deal signals a new scale of ambition — but also a new anxiety, as Indian firms can only pay in cash, unable to use their own shares as acquisition currency.
- From Tata Motors buying Italian truck-maker Iveco to Coforge acquiring a Silicon Valley AI firm, the deals span sectors and continents, driven by the hunt for capability rather than prestige.
- Smaller companies are joining the exodus too, setting up factories in the US where land is cheap and working capital flows more freely than in India.
- New free trade agreements and a rupee that loses roughly 40% of its value against the dollar each decade are structural forces that will keep Indian capital moving outward.
- The government wants investment to stay home, but the logic of hedging abroad compounds — leaving India caught between a global expansion story and a domestic growth problem it has yet to solve.
In late April, Sun Pharmaceuticals announced it would pay $11.75 billion for Organon & Co., a New York-listed women's health and biosimilars company — the largest overseas acquisition by an Indian firm in nearly two decades. It was not an isolated move. Last year, 162 Indian companies spent more than $18 billion acquiring foreign businesses, a 34 percent jump from the prior year, with deal value on pace to exceed $15 billion in just the first half of 2026 alone.
The names and numbers are striking: Tata Motors paid $4.4 billion for Turin-based vehicle maker Iveco. IT firm Coforge spent $2.35 billion on a Silicon Valley AI company. The Bajaj Group took a 23 percent stake in Allianz SE. But the motivations have changed since the last great wave of Indian acquisitions two decades ago, when buying Jaguar Land Rover or Corus Steel was about announcing arrival on the world stage. Today's deals are more calculated — companies are acquiring technology they cannot easily build at home, established brands, R&D expertise, and supply chain resilience in a world where trade barriers are weaponized.
The domestic backdrop explains much of the hunger. India's economy has lost momentum. Foreign investment has slowed. Private sector capital formation has disappointed despite strong corporate profits and government incentives. Investment managers describe a growing disaffection: even mid-sized Indian firms are setting up factories abroad, where industrial land is cheap and working capital easier to access. The financial mechanics have improved — stronger balance sheets, better access to global financing — yet a telling constraint remains: Indian companies still cannot use their own shares to pay for acquisitions, forcing all-cash deals that carry real financial risk.
Cautionary tales exist. Tata Steel's Corus acquisition became, in one analyst's words, an albatross for decades. But the structural forces pushing capital outward are durable. New free trade agreements with the UK, Europe, and Australia will ease investment flows. A younger generation of corporate heirs, educated abroad, naturally prefers assets in foreign currency as the rupee loses roughly 40 percent of its value against the dollar each decade.
The cost falls on India itself. As companies hedge abroad, domestic investment stays cautious and selective. The government wants capital to stay home, wants foreign investors to arrive, wants to restart the growth engine. Instead, Indian capital is moving outward — building futures elsewhere, leaving the domestic cycle of weak demand and anemic investment largely unbroken.
In late April, Sun Pharmaceuticals announced it would pay $11.75 billion to buy Organon & Co., a New York-listed women's health and biosimilars company. The deal was the largest overseas acquisition by an Indian firm in nearly two decades, and it arrived as part of something larger: a sustained wave of Indian companies buying assets abroad at a pace that would have seemed unthinkable just a few years ago.
The numbers tell the story. Last year, 162 Indian companies spent more than $18 billion acquiring foreign businesses—a 34 percent jump from the year before. If the current pace holds, deal value could exceed $15 billion in just the first half of 2026. The acquisitions span sectors and sizes: Tata Motors paid $4.4 billion for Iveco, the Turin-based vehicle maker. Coforge, an IT company, spent $2.35 billion on Encora, a Silicon Valley artificial intelligence firm. The Bajaj Group took a 23 percent stake in Allianz SE, the global insurance giant. These are not small bets or experimental forays. These are major corporations making major commitments to build or expand their presence in the West.
But the motivations have shifted since the last great wave of Indian acquisitions, two decades ago, when the Tata Group bought Jaguar Land Rover and Corus Steel as symbols of arrival on the global stage. Today's deals are more calculated. Companies are hunting for technology they cannot easily build at home, for established brands and distribution networks, for research and development expertise, for supply chain resilience in a world where trade barriers are weaponized and chokepoints matter. They are not buying trophies. They are buying capability.
The domestic backdrop explains much of this hunger. India's economy is not roaring as it once was. Foreign portfolio investors are leaving. Foreign direct investment has slowed. Private sector investment remains weak despite tax cuts and government subsidies designed to encourage it. The country's chief economic advisor acknowledged the paradox: corporate profits among India's top 500 companies grew at nearly 31 percent annually after the pandemic, yet overall capital formation from the private sector has disappointed. Money is there. Confidence in deploying it at home is not.
Investment managers and analysts describe a growing disaffection with the domestic business environment. Saurabh Mukherjea of Marcellus Investment Managers noted that even among the companies in his portfolio, many are setting up factories in the United States and elsewhere where industrial land costs almost nothing and working capital is easier to access than in India. It is not just the billionaires and household names. Dozens of smaller Indian companies are making similar moves, establishing greenfield operations or pursuing smaller acquisitions abroad.
The financial mechanics have shifted too. Indian companies now have stronger balance sheets and better access to global financing. They can move faster and larger than before. Yet there is a telling constraint: even deals as massive as Sun Pharma's Organon purchase are paid entirely in cash. Indian companies still cannot pay for major acquisitions with shares—a limitation that carries real financial risk and suggests something about how global markets view Indian corporate currency.
There are cautionary tales. Tata Steel's acquisition of Corus Steel became, in Mukherjea's words, an albatross around the company's neck for decades. Overseas deals can fail. But the trend is unlikely to reverse. New free trade agreements between India and the United Kingdom, Europe, and Australia will make it easier for Indian companies to invest in the West. A generation of corporate heirs is studying and living abroad; they naturally want to hold assets in foreign currency, especially as the rupee loses roughly 40 percent of its value against the dollar each decade. The logic compounds.
Yet this expansion abroad comes with a cost. As Indian companies hedge their bets by investing overseas, domestic investment remains selective and cautious. India is caught in a cycle of weak demand and anemic private investment, pressures now worsened by global energy shocks and the risks that artificial intelligence poses to an already fragile job market. The government wants capital to stay home, wants foreign investors to arrive, wants to restart the domestic growth engine. Instead, Indian companies are looking outward, moving money outward, building futures abroad. Whether this year's acquisitions will exceed last year's $18 billion remains uncertain amid current geopolitical tensions. But the direction is clear: Indian capital will continue to hedge against the uncertainties of home.
Citas Notables
We could cross $15 billion in deal value in just the first half of this year.— Sumeet Abrol, Grant Thornton
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.— Neha Singh, Tracxn
La Conversación del Hearth Otra perspectiva de la historia
Why now? India's been a major economy for years. What changed?
The domestic growth story broke. You had a bull market in the early 2000s when Tata was buying Jaguar. Now you have weak private investment despite government incentives, foreign investors leaving, and corporate profits that look good on paper but aren't translating into confidence to invest at home.
So they're running away?
Not running. Hedging. There's a difference. They're not abandoning India—they're diversifying. They want technology, brands, supply chains they can control, access to markets that aren't slowing. And they want assets in dollars, not rupees, because the currency loses value steadily.
The Sun Pharma deal was all cash. That seems risky.
It is. And it's telling. Indian companies still can't pay for major deals with shares. That suggests global markets don't trust Indian corporate currency the way they might trust American or European firms. So they have to use cash, which ties up capital and limits flexibility.
Is this sustainable? Can India keep exporting capital like this?
The government certainly doesn't want it to. They're trying to attract foreign capital and keep domestic money home. But the incentives are working the other way. Free trade deals with the West make it easier to invest there. Industrial land is cheaper abroad. Working capital flows easier. Why would you stay?
What about the failures? Tata Steel's Corus deal?
That's the warning. Overseas acquisitions can be disasters. But it hasn't stopped the wave. The next generation of corporate leaders studied abroad, want to live abroad, want to hold wealth abroad. The structural reasons for going overseas are stronger than the historical cautionary tales.
So India's exporting its best companies?
Not exporting them—expanding them. They're still Indian companies. But yes, they're building their futures in the West while India's domestic engine sputters. That's the real tension.