Samil PwC: "Indian Financial Market Growing Rapidly, Now Is the Right Time for Korean Companies to Enter"

Seminar on Strategies for Entering the Indian Financial Market
"Experts with Understanding of Regulations and Local Culture Are Essential"

As the Indian financial market experiences rapid growth, experts have suggested that investment and market entry strategies must take into account India's complex regulatory environment and unique negotiation culture.

On May 26, Samil PwC held a seminar titled "Successful Strategies for Entering the Indian Financial Market" at Amore Hall on the second floor of its headquarters in Yongsan-gu, Seoul, according to an announcement made on the 27th. The event was attended by more than 150 corporate representatives. The seminar covered topics such as the latest trends in the Indian financial market, entry strategies, merger and acquisition (M&A) opportunities, real-world success stories, and related regulatory and tax issues in depth.

Seungho Lee, Head of the Financial Sector at Samil PwC, is delivering the opening remarks at the seminar on "Successful Strategies for Entering the Indian Financial Market" held on the 26th at Amore Hall, headquarters in Yongsan-gu, Seoul. Samil PwC

In the first session, Chirag Bhasa, Partner at PwC India, introduced the structural characteristics and opportunities of the Indian market, including the growth potential of the financial sector, large population, the spread of digital finance, and government policies to attract foreign investment. He emphasized, "India's expanding middle class and rapidly increasing digital penetration are significantly boosting growth potential in various financial sectors, including insurance and lending," adding, "This is a strategic time for Korean companies to enter the market."

In the second session, Daeho Kang, Partner in the Deals Division at Samil PwC, gave a presentation on "M&A Strategies for the Indian Financial Market." According to Kang, the Indian financial market has seen an increase in demand for financial services due to GDP growth and the expansion of the middle class, with the number of transactions recording an average annual growth rate of 21.7% from 2020 to 2024. Financial institutions are actively acquiring fintech companies to strengthen their digital capabilities, and foreign investment has also been vigorous, with recent years seeing increased investment from Japanese, Singaporean, and Korean companies. In Korea, Mirae Asset Group entered the Indian retail financial market in earnest in 2023 by acquiring a stake in a non-banking financial company (NBFC).

However, obstacles have been identified, such as conflicts arising from India's unique cultural and institutional differences, as well as low levels of trust in information and negotiation outcomes. Kang stressed, "A successful M&A hinges on accurate valuation based on an understanding of India's unique negotiation culture," and added, "It is essential to seek assistance from local experts at the planning stage, appoint advisors with local networks in each sector, document all agreements, and conduct prior analysis and establish detailed strategies."

In the third session, Kyusang Cho, Partner at PwC Consulting, shared success cases of entering the Indian financial market. Cho analyzed, "While domestic banks are continuously expanding their corporate finance business, Japan's megabanks are shifting from traditional corporate finance to non-banking digital businesses."

Notable examples included Mitsubishi UFJ Financial Group (MUFG), Japan's largest financial group, acquiring a stake in Indian fintech company DMI Finance in April 2023, and Sumitomo Mitsui Financial Group (SMFG) acquiring stakes in Fullerton India Credit and Yes Bank to secure a local financial network in India. Cho emphasized, "For successful market entry, it is necessary not only to enter the market but also to establish a clear investment direction from the outset," adding, "Companies should consider collaboration or investment with NBFCs and fintech firms, and continuously monitor market volatility factors."

In the final session, Indae Park, Partner in the Tax Division at Samil PwC, gave a presentation on "Key Regulatory and Tax Considerations in the Indian Financial Market," introducing major stakeholders in the Indian government, the complex tax system, and key tax policies. He provided a detailed explanation of major regulations in India, including sanctions related to free and fair competition, regulations on M&A activities, and restrictions on foreign ownership. Park stated, "Although many regulations have been eased, each rule contains hidden details that require careful review," and

added, "It is essential to collaborate with experts who have a deep understanding of the Indian financial market structure and regulations and can design the optimal structure in advance."

Meanwhile, Samil PwC leverages its close network with PwC India and high level of expertise on India to provide tailored, integrated solutions for domestic and global companies, including accounting and tax advisory, investment consulting, and strategic advisory services related to India. In particular, Kyu Jin Kim, Director at Samil PwC, who is currently stationed in India, is responding quickly and effectively to a wide range of client needs on the ground.