Position in global landscape

Questioned about his thoughts on how well India has fared amid the global macroeconomic challenges compared to other emerging markets in Asia, Dickson noted that the country is currently the fifth-largest economy globally and is poised to climb to the third position.

Also Read: India’s appeal as alternative to China rises: Citi’s Khullar

The enthusiasm of Indian business leaders, coupled with the ‘China plus one’ strategy, makes India an attractive market for global investors, he said. Citi sees it as one of the best opportunities for both Indian and international clients, it reported.

M&A, deals and more

On the environment regarding M&As and tighter global liquidity conditions, Dickson felt that India’s M&A market remains robust at around $85 billion despite global challenges. While the debt capital markets (DCM) face challenges due to fluctuating rates, Citi maintains a positive long-term perspective on the M&A landscape in India, he added.

Also Read: Citi cuts another 2,000 jobs, severance costs at $650 million

In terms of deal activity he feels that higher interest rates globally indicate slower economic growth and necessitate adjustments in deal activity. He however noted that stability in the cost of capital is crucial, and that as the market recalibrates, confidence will increase. The focus on quality in earnings, cash flow, and growth becomes more significant in a higher interest rate environment, he added.

Further, Dickson also expressed a long-term bullish outlook on technology, considering it a fundamental driver of growth, the report said. While acknowledging the challenges faced during the “technology winter,” Citi is cautiously optimistic about increased activity levels for technology companies in M&A, ECM, and DCM in 2024, he added

India outlook

Acknowledging that there is a “financing wall in the 2025-2026 era”, characterized by the need to refinance debt at higher costs, Dickson said Citi emphasises that this debt is not super expensive. The bank sees an opportunity for the global market to adjust to this reality, considering historical periods with more expensive debt, it said.

Also Read: Citi India sees $22 billion in equity capital deals in 2023, says CEO

On the whole, the bank eyes India as a beacon of stability and opportunity despite global economic uncertainties. And it maintains positive outlooks for M&A, equity markets, and the technology sector in the coming years.

Tyler Dickson is Citi’s Co-Head of Banking, Capital Markets and Advisory, which includes all of Citi’s corporate and investment banking activities including debt and equity capital markets, lending and advisory, as per the company website. He also manages Citi’s Financing & Securitization and Institutional Credit Management efforts. Tyler is a member of Citi’s Global Operating Team and of the Institutional Clients Group Management Committee, it added.

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Updated: 17 Oct 2023, 12:21 PM IST