India is hot for investment banks

I have been flagging India's growing importance to the international investment banks adn I've said that the decision of the big ones- Morgan Stanley, Merrill and Goldman Sachs- to go it alone or as the dominant partner reflects this.

Today's FT story on how important India is to Merrill Lynch underlines this. Two factors have been particularly important in making India important to the world majors: rising share issuance and M&A volumes.

India has for the first time become the biggest revenue contributor among Asia’s emerging economies for Merrill Lynch, highlighting the country’s increasing importance for global investment banks.

The trend was driven by a record flow of share offerings and large mergers and acquisitions in India this year, coupled with increasing principal investment by the bank, said Patricia McLaughlin, vice-chairman and managing director, investment banking and M&A at DSP Merrill Lynch. “India has become relevant to Merrill Lynch in revenue terms; not only regionally but globally,” Ms McLaughlin told the Financial Times.

.......Merrill Lynch did not provide figures for its Indian revenues but said they were larger than those for other markets in Asia excluding Japan and Australia.

This year's share issuance undewriting by the top 10 underwritersis $23. 3 bn to date, double that in the same period last year; and M&A volumes are $63.9 bn, again twice as last year. That would explain why Bear Stearns is planning to enter India soon.