Global dealmaking is gathering momentum, weathering macroeconomic uncertainty, elevated interest rates and geopolitical risks. From record-breaking M&A volumes to a rebound in equity capital markets, key markets are buzzing, with India emerging as a standout growth story.
In an interview to Moneycontrol, Kim-Thu Posnett, global co-head of investment banking at Goldman Sachs, shares her outlook on global investment banking, the resurgence of strategic transactions and the factors driving India’s equity market performance. She also offered insights into how AI was reshaping capital formation and how Goldman Sachs was sharpening focus on India, a pillar of its growth strategy in Asia. Here are the edited excerpts of the interview:
How would you characterise the state of global investment banking activity? Are there any sectors or geographies that are leading the recovery?
Our investment banking business remains strong globally despite the elevated levels of uncertainty and volatility that we’ve seen in the market in the first half of the year. We are actively working on a strong pipeline of strategic and financing deals around the world, which is testament to the fact that CEOs, CFOs and boards — while perhaps a bit more cautious than they were at the start of the year — are still looking to invest in their businesses by raising capital and pursuing strategic M&A.
The M&A market remains open and is up considerably year-on-year on both volume and deal count across regions and industries. Globally, the number of deals over $500 million are up 17 percent year-on-year. Goldman Sachs is ranked Number 1 in announced M&A by deal volume and count for deals over $500 million.
As it relates to geographies, Asia Pacific is outperforming with deal count for deals over $500 million up 33 percent year-on-year, compared to up 19 percent in the Americas and up 4 percent in EMEA (Europe, the Middle East and Africa).
Additionally, in Asia Pacific, the volume of M&A transactions over $500 million has grown 190 percent year-on-year, relative to 16 percent in the Americas and 15 percent in EMEA. We are also seeing sponsor activity continuing to grow across regions, with volume of M&A transactions over $500 million, up 131 percent in Asia Pacific, up 50 percent in the Americas and up 49 percent in EMEA.
In the capital markets, we are continuing to see signs of improvement, specifically, in equity markets, conditions have improved over the last few weeks and issuance has accelerated globally.
While the Americas are leading the activity, so far, this year, 26 percent of global IPO volumes are represented by companies listed in Asia Pacific and India remains very active.
Global investment grade debt capital markets are running at significantly elevated levels, driven by significant corporate financing activity in both Europe and the US. While yields remain elevated, spreads are near their tightest levels in 20 years. And, despite a pocket of tariff-driven volatility in April, global leverage finance markets have returned to near multi-year spread tights driven by robust technical tailwinds, and issuance is now correspondingly on pace to catch-up with long-term averages in the second half of the year.
Amid a shifting rate environment and persistent geopolitical risks, which are the themes that are shaping deal-making?
CEOs, boards and the financial sponsor community are getting accustomed to a "higher-for-longer" rate environment and persistent geopolitical risks, so they are looking for ways to do deals despite those exogenous factors.
Broadly speaking, corporate sentiment is decent and the health of the consumer is pretty good. We are seeing a return of optimism to the market, which, we believe, could set us up for a strong fourth quarter as it relates to corporate CEOs and financial sponsors looking to transact.
There are three dominant themes shaping the global dealmaking landscape. First, we see strength in middle market activity ($2-5 billion EV), with deal count up 53 percent year-on-year. Second, the number of announced mega-deals (over $10 billion) is up over 74 percent year-on-year, including industry-defining transactions such as the sale of Wiz to Alphabet ($33 billion), Sycamore Partners’ acquisition of Walgreens ($23 billion) and QXO’s acquisition of Beacon Roofing Supply ($11 billion). Lastly, sponsor-led M&A continues to grow with deal count up 19 percent year-on-year for deals over $500 million.
India has seen record equity capital market (ECM) activity over the past year. What, in your view, is driving this momentum? Will this pace sustain?
Yes, we are seeing the making of a multi-year ECM cycle in India, with both structural and technical factors beginning to align. This will collectively grow India’s share of global capital raising activity. We saw initial signs last year, with almost 11 percent of global ECM volumes coming from India, compared to a five-year average of 3 percent.
There are several key factors driving the momentum in Indian equity capital markets. First, a growing cohort of established startups are looking to raise capital and expand their businesses by tapping into public markets. Second, we have the ‘financialisation of household savings’, deepening the domestic investor base, which represents a trend where we see retail investors moving towards non-banks and directing their savings into markets. Lastly, global institutional investors are seeking exposure to quality Indian equities. There are also some new themes gathering pace in India such as multinational companies choosing to explore listings of their India subsidiaries and companies redomiciling to India for listing prospects.
After a record 2024, several global and domestic factors, including ongoing trade, economic and geopolitical developments, have weighed on India ECM activity this year. However, there are clear signs of a pickup in activity. Out of the $22 billion in ECM volumes to date in India, about $14 billion were completed in just the last two months. We expect this momentum to continue for the rest of the year and into 2026.
How do Indian ECM dynamics compare to other emerging markets that Goldman Sachs covers? What are global clients saying about India listings?
Today, India stands out as one of the most active equity capital markets globally. We are seeing a clear pick-up in conversations with global investors who are increasingly focused on India listings, attracted by the opportunity to chase growth and diversify their portfolios through a wide range of deal structures made possible through strong liquidity in the Indian markets. We are also seeing growing interest from global corporate clients exploring listing their India businesses or choosing India as a listing venue, particularly where the cost base or meaningful revenues are being driven out of India.
The advancement of AI is expected to transform productivity and capital formation. Who will finance the opportunities created by AI?
That’s right, we think of AI as the fundamental transformation that’s reshaping industries and competitive dynamics globally. We are seeing a broad and diversified set of players invest across different layers of the AI ecosystem, including across both application and infrastructure, which continue to scale at pace.
Nations are beginning to leverage data centre infrastructure as a critical geopolitical and economic tool in the AI era — strategically building centres in locations chosen by businesses and governments.
While infrastructure funds, sovereign wealth funds and pension funds initially served as key players funding AI infrastructure development, real estate funds, asset managers, insurance aggregators, and even more traditional private equity shops are now stepping up to offer newer pockets of capital.
International investors are also getting creative exploring cross-border partnerships to deploy capital, and as we’ve seen, hyperscalers are also vesting interest in building out AI infrastructure to support their LLMs.
It’s widely thought that if infrastructure is the engine, an AI application is the car; applications rely on infrastructure for speed, scale, and performance. Teaching models to recognise patterns and generate responses through AI training is particularly energy intensive, necessitating data centre campuses with high-powered GPUs, dedicated power supply, and advanced cooling systems. Unsurprisingly, hyperscalers are at the forefront of this investment, projected to invest $1T in the technology by 2027. Most of this investment is concentrated in training larger, more advanced models, which inherently require larger, power-hungry data centres with the resources to handle these massive AI workloads.
Are there any distinct trends in how Indian corporates or startups are approaching AI-related capital needs?
India is positioned as one of the fastest-growing AI economies globally, which is being fuelled by significant investments in enterprise technology and a uniquely skilled labour force. Though progress thus far has been modest relative to other economies competing for AI supremacy, India is certainly the one-to-watch.
There are several interesting AI startups in India across the infrastructure, platform and application frameworks, which are expected to be fuelled by a strong labour force. Similar to the services industry, India is expected to grow a particularly skilled talent bench for AI.
A growing number of Indian corporates are strategically adopting AI in workflows, while in parallel (they are also) investing in developing their own AI systems. So far, funding for these investments has predominantly been made through private markets. However, we believe public and private markets will coexist and grow and that there will be use cases for AI-related capital raising in both markets.
What are the pockets of investment or innovation — globally and in India — that excite you most?
The rapid progress in artificial intelligence is by far the most exciting pocket of innovation globally, and as I mentioned, for India. What excites me most isn’t just the technology itself but how AI is transforming entire industries and unlocking new models of value creation.
Globally, we’re seeing innovation in foundation models (LLMs), autonomous systems, and AI-powered drug discovery. Meanwhile, India is seeing a surge in AI-enabled solutions tailored to local challenges — like vernacular language processing, precision agriculture and healthcare access through telemedicine and diagnostics.
What’s particularly inspiring is the convergence of AI with other fields —such as education, robotics, climate tech, and genomics, which is leading to breakthrough applications. India’s growing developer base, strong digital infrastructure and policy support are also creating a fertile ground for scalable innovation.
How is Goldman Sachs positioning itself to capture growth in India, both in terms of capital markets and strategic advisory?
Goldman Sachs has remained a top M&A advisor in India for the last few decades, advising on marquee transactions. We are excited about the investment banking opportunity in India across capital markets and strategic advisory and have made several senior strategic hires over the last few years. Our investment banking team in India today is the largest that it has ever been.
Currently, we are focused on four key themes in India — buyouts driven by financial sponsors; middle-market M&A activity; strategic investment by multinationals and equity capital markets opportunities. The capital markets have come of age in India and we remain focused on growing that business even further.
With India being a rare growth outlier in a slowing world economy, how important is the market to Goldman Sachs' emerging markets strategy?
India is growing in prominence as an investment destination for both our global financial and strategic investor clients. As we align with this increased client focus, our India strategy has become integral to driving the growth of our broader Asia Pacific franchise, alongside more mature economies like Japan and China.
Both cross border M&A and ECM activity, which are central to our investment banking business globally, are expected to remain elevated in India for the foreseeable future.
Are there any sectors in India where Goldman Sachs is looking to deepen its engagement either through IB mandates, investing, or advisory work?
We are seeing increased investment banking activity in India across growth sectors like technology, manufacturing, energy transition and healthcare. Financial sponsors are also becoming a core client base for us across our wider business.
Over the past 10 to 20 years, our clients all over the world have grown dramatically in size, global reach, and business complexity. Through “One Goldman Sachs” — the operating ethos of our firm — we put clients at the centre of everything we do. Our goal is to bring the best of our firm globally to our clients by offering them holistic and integrated solutions.
With the growing maturity of Indian markets and growing sophistication of our clients in India, our One GS approach has become even more important, helping us deepen our client discussions and engagement across the region.
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