2025: Foreign Investors Make Big Deals in India’s Financial Sector

India's financial sector has seen foreign companies investing heavily in 2025. According to the data available from Grant Thornton, from January to September, the Indian financial sector witnessed mergers and acquisitions worth 8 billion dollars, a 127 per cent rise compared to the same period last year.

Here are some of the significant investments seen in 2025.

MUFG invests in Shriram Finance

Japan's Mitsubishi UFJ Financial Group (MUFG) is buying a 20 per cent stake in Shriram Finance, investing 4.4 billion dollars. This is the largest foreign investment in India's financial sector in 2025.

Shriram Finance's stock rose by 50 per cent this year, making it the company's best year since 2017. The shares are currently trading at 901.70 rupees, up 3.71 per cent from the previous close. MUFG will buy shares at 840.9 rupees each, which is just under a 3 per cent discount in the current trading price.

Broking analysts have noted that the deal values Shriram Finance at 1.9 times over its estimated book value, which is lower than peers like Cholamandalam Finance.

Emirates NBD takes control of RBL Bank

Dubai-based Emirates NBD is acquiring 60 per cent stake in RBL Bank for 3 billion dollars. The deal will give Emirates NBD access to RBL's large branch network, which it plans to merge with its Indian subsidiary.

RBL Bank shares, currently trading at 299.70 rupees, up 0.5 per cent. Brokerages maintain a bullish stance on the stock, with Emkay Global proposing to buy at a target price of 375 rupees and ICICI Direct fixing a target of 415 rupees, citing the capital infusion as a major growth driver.

SMBC raises stake in Yes Bank

Sumitomo Mitsui Banking Corporation (SMBC) of Japan bought a 20 per cent stake in Yes Bank for 1.6 billion dollars in May and added another 4.99 per cent in September.
Yes Bank shares are trading at 21.70 rupees, up 24.36% since December 2022. Analysts have a mixed forecast on the stock with a general consensus leaning towards a "strong sell" based on a review of 10 analysts. However, some individual market experts suggest "hold".

Blackstone invests in Federal Bank.

Blackstone, through a Singapore-based affiliate, is investing 61.97 billion rupees (about 705 million dollars) for a 9.9 per cent stake in Federal Bank. The deal will enable Blackstone to nominate a board member in the bank.

Federal Bank shares are trading at 267.85 rupees, up 0.92 per cent. UBS has raised its target price to 310 rupees, citing strong fundamentals and growth potential.

IHC bets on Sammaan Capital

Abu Dhabi's International Holding Company (IHC) is investing nearly 1 billion dollars to buy 43.5 per cent stake in Sammaan Capital, a non-bank lender focused on housing loans. IHC will also make an open offer to buy another 26 per cent from retail investors, as required by Indian takeover rules. The stock is currently trading at 145.40 rupees with an intraday hike of 1.34%.

Warburg Pincus and ADIA back IDFC First Bank

Warburg Pincus and Abu Dhabi Investment Authority (ADIA) invested 877 million dollars in IDFC First Bank through convertible preference shares. These shares can later be converted into regular equity, giving the investors a combined 15 per cent stake.
HDFC Securities recommended the shares for a one-year horizon to Diwali 2026, expecting a potential growth of over 15%.

Bain Capital targets Manappuram Finance

Bain Capital agreed to buy an 18 per cent stake in Manappuram Finance for 508 million dollars. The firm plans to increase its stake to over 40 per cent through an open offer.
Manappuram Finance shares are trading at 292.65 rupees, up 1.95 per cent. ICICI Securities has a buy rating with a target price of 305 rupees, noting improved asset quality and a new strategic direction.

Bajaj Group ends Allianz partnership

In March, Bajaj Group bought back a 26 per cent stake in its two joint ventures-Bajaj Allianz General Insurance and Bajaj Allianz Life Insurance-from German insurer Allianz for 2.8 billion dollars, ending a decade-long partnership.

Bajaj Finserv, the parent company, is trading at 2043.80 rupees, up 0.86 per cent. The Stock Price Archive sees a 25% average return in the stock in 2026.

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