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Sun Pharma's record-breaking acquisition marks shift in strategy
India's pharmaceutical giant Sun Pharmaceuticals has agreed to acquire U.S.-based women's health and biosimilars firm Organon & Co. for $11.75 billion, the largest overseas purchase by an Indian company in nearly 20 years. The deal, announced in late April, underscores a growing trend of Indian firms expanding globally despite domestic economic challenges.
Surge in outbound deals reflects strategic priorities
The Organon acquisition follows a series of high-profile international transactions by Indian corporations in 2025. Tata Motors purchased Turin-based vehicle manufacturer Iveco for $4.4 billion, while IT firm Coforge acquired Silicon Valley's Encora for $2.35 billion. Earlier in the year, the Bajaj Group also secured a 23% stake in global insurer Allianz SE.
Data from Grant Thornton reveals that Indian companies completed 162 outbound acquisitions worth over $18 billion in 2025, a 34% increase from the previous year. Sumeet Abrol, a partner at the consultancy, told the BBC that deal values could surpass $15 billion in the first half of 2026 alone.
Motivations differ from past acquisition booms
Analysts note that today's overseas expansion is driven less by prestige and more by operational needs. Unlike the early 2000s, when Indian firms like Tata Group pursued trophy assets such as Jaguar Land Rover and Corus Steel, current acquisitions aim to secure technology, supply chains, and market access.
V Anantha Nageswaran, India's chief economic advisor, recently highlighted a paradox: while corporate profits for the country's top 500 companies grew at 30.8% annually post-pandemic, private sector capital formation remains weak. Experts suggest this disconnect reflects frustration with domestic conditions and better opportunities abroad.
Smaller firms join the trend as financing improves
The push for global expansion isn't limited to conglomerates. Saurabh Mukherjea of Marcellus Investment Managers noted that dozens of smaller Indian companies are establishing greenfield factories in the U.S. and other markets, where industrial land and working capital are more accessible.
Neha Singh, co-founder of Tracxn, attributed the trend to stronger balance sheets and improved access to global financing. "Indian companies are targeting overseas markets, brands, and R&D expertise to accelerate growth," she said. The strategy also helps mitigate risks from trade barriers and supply chain disruptions.
Risks and long-term outlook
Despite the momentum, overseas acquisitions carry financial risks. Mukherjea pointed to Tata Steel's troubled Corus Steel purchase as a cautionary tale, noting that Indian firms still rely on cash rather than shares for deals, even for transactions as large as Sun Pharma's.
Looking ahead, Mukherjea predicted a "deluge" of outbound deals, fueled by free trade agreements with the UK, Europe, and Australia. However, Abrol of Grant Thornton warned that geopolitical instability could temper the pace of transactions.
As India grapples with weak domestic demand and a sluggish job market, experts agree that the long-term trend favors further global expansion. "Indian companies are hedging against economic uncertainties at home," Singh said, even as the government seeks to attract foreign capital to revive growth.
