Investment Banks Anticipate $1.3 Billion in Fees by 2025
India’s investment banking sector is experiencing a remarkable surge, with fees reaching a record $1.3 billion in 2025, driven by a wave of initial public offerings (IPOs) and strong mergers and acquisitions (M&A) activity. Jefferies has emerged as the leader in this competitive landscape, with its bankers poised to earn nearly $100 million. This marks a significant rise from previous years, showcasing the dynamic growth of investment banking in the country.
Jefferies Leads the Charge
Jefferies has topped the investment banking fee rankings in India, earning $98.9 million in 2025, a substantial increase from $70 million in 2024. This impressive leap from fourth place to the top spot highlights the firm’s rapid growth, as it was ranked 26th just five years ago with only $12 million in fees. Following closely behind, Morgan Stanley and JP Morgan secured second and third positions, earning $85 million and $81 million, respectively. In contrast, these banks ranked seventh and thirteenth in 2024, indicating a significant shift in the competitive landscape. The fee rankings are crucial for determining bonus payouts for bankers, which are typically announced by foreign banks in January after the year-end break.
Equity Capital Markets Drive Growth
The equity capital markets (ECM) have been the primary driver of fee generation, contributing $656 million to the total investment banking fees. This growth has been fueled by a booming IPO market and robust block trades. In addition to ECM, mergers and acquisitions advisory generated $396 million, while debt capital markets contributed $246 million, excluding loan syndication. The current trend marks a shift from previous years when M&A advisory dominated the fee landscape. Vikas Khattar, head of ECM at Ambit, noted that the Indian ECM market has matured, leading to increased competition between ECM and M&A fees in the coming years. A strong ECM market not only boosts confidence in large M&A deals but also enables acquirers to raise necessary capital.
Foreign Banks Dominate the Rankings
In a notable change from 2024, foreign banks have claimed the top three spots in the investment banking fee rankings for 2025. This contrasts sharply with the previous year when domestic lenders such as Kotak Mahindra, ICICI, and Axis led the charge. The surge in large ECM deals has attracted greater participation from international banks, allowing them to capture a significant share of the fees. Samarth Jagnani, head of ECM at Morgan Stanley India, highlighted that the firm advised on ten transactions exceeding $1 billion in 2025, reflecting the increasing involvement of foreign banks in high-value deals. Kotak Mahindra and Axis ranked fourth and fifth, earning $78 million and $67 million, respectively, while Citi climbed to sixth place with $61 million, up from tenth in 2024.
Banking Sector Expansion Amid Strong Deal Momentum
As deal activity remains robust, banks are expanding their teams to capitalize on the momentum. However, the bonus cycles differ between foreign and domestic banks; foreign bankers’ bonuses are tied to the previous calendar year’s performance, while local banks follow the April-March financial year. Rahul Saraf, head of investment banking at Citi India, noted that the firm increased its investment banking team by 23% last year and plans to expand by an additional 25% due to a strong pipeline of business opportunities. This growth reflects the optimism within the sector as banks prepare for continued success in the evolving investment landscape.
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