The technology sector in India witnessed deals amounting to $3.9 billion in the first quarter of 2026, marking the highest quarterly deal value since Q3 2022. Despite an overall decline in deal volumes, a report by Grant Thornton Bharat revealed 68 transactions during the quarter, including IPO and QIP activities. Notably, while deal volumes dropped by 8%, the deal value saw a significant 43% surge, driven by a few large-ticket transactions collectively valued at nearly $3 billion.
Excluding public market activity, the sector recorded 66 deals worth $3.4 billion. Although volumes decreased by 7% quarter-on-quarter, values rose by 39%, indicating a trend towards high-value, selective investments. Deal volumes witnessed a 26% year-on-year decline, while the total value more than tripled, showing a substantial 208% increase.
Raja Lahiri, Partner and Technology Industry Leader at Grant Thornton Bharat, highlighted that the domestic technology deal landscape is experiencing a structural transformation, with a growing focus on high-conviction opportunities. He emphasized the increasing importance of Artificial Intelligence (AI), especially generative AI, in investment decisions, leading to capability-driven acquisitions in AI, cloud, and digital engineering, positioning Indian firms as global consolidators.
In the Mergers and Acquisitions (M&A) segment, deal volumes remained stable at 21 transactions, but values surged over threefold to $2.6 billion. Outbound deals took the lead in M&A activity, contributing approximately 97% of the total value, while domestic transactions accounted for most volumes but a small share of value. Inbound activity remained limited during the quarter.
Private equity and venture capital activity saw moderation, with 45 deals amounting to $848 million, reflecting a 49% decline in value due to the absence of large-ticket investments. Notably, a single deal represented nearly 71% of the total PE value, underscoring the concentration of capital. Despite the decline in values, PE/VC deals continued to dominate volumes, making up about two-thirds of total deal activity, with a focus on early and mid-stage investments, particularly in AI-driven and enterprise technology segments, as per the report.
