Kotak Investment Banking Expects Overall M&A Volumes To Grow 10-15% In 2026

Kotak Investment Banking projects a robust growth in mergers and acquisitions (M&A) activity for the year 2026, anticipating an overall increase in deal volumes by 10 to 15 percent. This optimistic forecast is grounded in a combination of structural and cyclical factors that are expected to drive deal-making momentum across various sectors. The outlook reflects a positive trajectory following a strong performance in the previous year.

In 2025, the M&A market experienced a significant surge, with deal values rising by 14 percent year-on-year to reach $121 billion. This growth occurred despite a global decline in deal volumes, highlighting the resilience and dynamism of the market segments Kotak Investment Banking monitors. Sourav Mallik, managing director of Kotak Investment Banking, emphasized that this trend underscores the underlying strength in key industries and the strategic importance of M&A as a growth lever.

Looking ahead, Kotak identifies financial services, technology, consumer, and healthcare sectors as the most active areas for M&A transactions in 2026. These sectors are poised to benefit from ongoing innovation, regulatory changes, and evolving consumer demands. Financial services continue to adapt to digital transformation and regulatory shifts, technology companies are driven by advancements in AI and cloud computing, consumer businesses are responding to changing preferences, and healthcare is propelled by increased investment in biotech and health tech solutions.

The expected growth in M&A volumes is supported by structural factors such as market consolidation, the pursuit of synergies, and strategic repositioning by companies aiming to enhance competitive advantage. Cyclical factors include favorable economic conditions, availability of capital, and improving investor confidence. Together, these elements create an environment conducive to deal-making, with companies seeking to capitalize on growth opportunities and optimize their portfolios.

This forecast has important implications for stakeholders across the business landscape. For investors, increased M&A activity suggests potential for value creation and portfolio diversification. For companies, it signals a need to remain agile and proactive in exploring strategic partnerships or acquisitions. Additionally, advisors and financial institutions may see heightened demand for their expertise in navigating complex transactions.

In summary, Kotak Investment Banking’s projection of a 10-15% increase in M&A volumes in 2026 reflects a continuation of strong market trends supported by both fundamental and cyclical drivers. The emphasis on key sectors such as financial services, technology, consumer, and healthcare highlights areas where innovation and strategic realignment are likely to fuel deal activity. This outlook provides valuable insight for market participants preparing for the year ahead.