Auto Sector Deal Activity Slips to Three-Year Low as EV and Mobility Firms Draw Investments

India’s automotive industry recorded transactions worth $717 million during the April-June quarter of 2026, even as the number of deals dropped to the lowest quarterly level in three years, according to a report by Grant Thornton Bharat. The sector saw investors focus on fewer but larger transactions, with funding directed mainly towards EV, mobility and automotive technology businesses.

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Fewer Deals, Limited Decline in Investment Value

The sector registered 20 mergers and acquisitions (M&A), private equity (PE) and public market transactions during the quarter. Although the volume of deals went down compared to last quarter, the overall value of deals dropped by just 4%, suggesting that investments were focused on bigger deals.

The auto sector saw 18 M&A and PE/VC deals worth a total of $479 million, not counting the ones made via public markets. The majority of these investments was focused on mobility platforms and automotive tech companies.

Technology-Led Acquisitions Remain in Focus

M&A activity remained relatively muted, with five transactions valued at $138 million during the quarter. The largest acquisition was KPIT Technologies’ purchase of Israel-based Cymotive Technologies for $120 million.

According to Grant Thornton Bharat, the acquisition reflects increasing strategic investments in automotive cybersecurity, software-defined vehicles and connected mobility technologies. Although the number of acquisitions remained limited, average deal sizes increased as companies prioritised technology capabilities over expansion through scale.

Large Funding Rounds Dominate Private Equity Activity

Private equity and venture capital investments totalled $341 million across 13 deals during the quarter. Funding activity remained concentrated in a small number of transactions.

Rapido managed to obtain the largest investment in the quarter, raising $240 million, while JBM Ecolife Mobility raised $47 million. As per the report, investors kept on making investments in startups with a working model and growth opportunities in the mobility space.

EV Ecosystem Raises Funds

Mobility-as-a-service was the leading investment category, raising $298 million in the quarter. Electric vehicle companies accounted for 54% of private equity deal volumes, highlighting sustained investor participation in India’s EV ecosystem.

Automotive technology contributed 87% of the total M&A value during the period, reflecting continued investments in software, cybersecurity and connected vehicle technologies.

Grant Thornton Bharat said the five largest private equity transactions represented nearly 96% of the total PE investment value in the quarter, indicating that investors remained focused on category leaders with proven scale and stronger growth visibility amid a more selective funding environment.