New Delhi, April 14 (NationPress) In the first quarter of 2026, India's automotive and electric vehicle (EV) sector witnessed a total of 35 transactions amounting to $745 million, indicating a steady but selective deal climate, as per a report released on Tuesday.

The analysis from Grant Thornton Bharat indicated that deal volumes remained relatively unchanged quarter-over-quarter, and the total deal values decreased from $837 million in the previous quarter.

This decline in value can be attributed to the lack of significant cross-border deals and large-scale transactions, with no IPO or QIP activities reported during this period.

There was a remarkable drop in outbound deal values, recorded at $10 million in Q1 2026, a stark contrast to $4,064 million in Q3 2025. This shift signifies a normalization in overall deal values, even as investments continued to flow into electrification, mobility solutions, and supporting infrastructure.

Private equity (PE) transactions were the primary catalyst for deal-making in Q1 2026, with 28 deals accounting for $702 million, reflecting a 12% increase in volume and a staggering 86% rise in value.

Overall, the report highlighted that deal-making was cautious, with investors and acquirers concentrating on risk-adjusted, scalable ventures.

Saket Mehra, Partner and Auto and EV Industry Leader at Grant Thornton Bharat, remarked that India's auto and EV sector is reaching a pivotal moment, fueled by rising domestic demand, rapid electrification, and an increasing emphasis on supply-chain resilience in light of changing geopolitical circumstances.

“Ongoing policy support is bolstering the EV ecosystem, particularly in areas like energy storage and infrastructure. In this context, deal activity is centered around future-ready themes, with investors emphasizing electrification and mobility platforms, as well as ecosystem enablers such as charging stations, battery swapping, and battery technologies,” Mehra stated.

Mergers and acquisitions (M&A) activity was subdued in Q1 2026, with only 7 deals valued at $43 million, marking a 22% decrease in volume and a dramatic 91% fall in value.

The deal activity was primarily led by small-scale, capability-driven acquisitions, predominantly through domestic channels, with minimal outbound transactions (only 2 deals).

Acquirers maintained a focus on technology, digital enhancements, and ecosystem relevance, aiming to strengthen platforms rather than pursue scale-driven consolidation, the report concluded.

aar/pk