India Auto, EV Deal Activity Remains Selective in Q1 2026; PE Drives Investment Value

India’s automotive and electric vehicle (EV) sector recorded 35 deals worth USD 745 million in the first quarter of 2026, according to a report by Grant Thornton Bharat. Deal volumes remained largely unchanged from the previous quarter, while total values declined from USD 837 million in Q4 2025 due to the absence of large cross-border and scale-driven transactions.

There were no public market deals, such as IPOs or QIPs, during the quarter. Outbound deal values also fell sharply to USD 10 million, compared to USD 4.06 billion in Q3 2025, indicating a normalisation in transaction sizes. Investment activity continued to focus on electrification, mobility platforms and supporting infrastructure.

Mergers and acquisitions (M&A) activity remained subdued, with seven deals valued at USD 43 million. This represented a decline in both volume and value compared to the previous quarter. Transactions were largely small-scale and focused on acquiring capabilities rather than expanding scale. Domestic deals accounted for the majority, while outbound activity remained limited. Cars24 completed two domestic acquisitions—Vehicleinfo and Carinfo—to expand its offerings across the vehicle ownership lifecycle.

Private equity (PE) investments were the primary driver of deal activity, accounting for 28 deals worth USD 702 million. Both volumes and values increased compared to Q4 2025, supported by a mix of large investments and smaller transactions. EV-related deals led activity, followed by mobility-as-a-service and auto-tech segments.

Key transactions included investments by KKR in PMI Electro Mobility Solutions and Allfleet India, along with funding rounds in GreenCell Mobility and Drivn Transition.

Saket Mehra, Partner and Auto and EV Industry Leader, Grant Thornton Bharat, said, “Deal activity remains focused on future-ready themes, with investors prioritising electrification, mobility platforms, and ecosystem enablers such as charging, swapping, and battery technologies.”

The report noted that traditional automotive segments, including components and heavy vehicles, continued to see limited deal activity amid ongoing industry transition.