Fundraising via debt placement dips 37% to Rs44,000 crore in October
New Delhi: Indian companies raised over Rs44,000 crore in October through private placement of corporate bonds, down 37% from the year-ago level, for business expansion and propping up working capital needs.
With the latest mobilisation, the total fundraising through private placement of debt securities reached Rs3.68 lakh crore in April-October period of 2017-18 fiscal, latest data with markets regulator Securities and Exchange Board of India (Sebi) showed.
In the entire 2016-17 fiscal, the capital raked in through the route stood at Rs6.4 lakh crore. In private placement of bonds, firms issue securities or bonds to institutional investors to raise capital. According to the data with the Sebi, companies garnered Rs44,146 crore from debt on a private placement basis last month, much lower than Rs70,395 crore raised in October 2016.
In terms of numbers, 213 issues were made last month compared with 275 in the year-ago period. The funds have been raised mainly for business expansion, to support working capital requirements and retire their existing debt.
Market experts attributed the lower capital raising in the fiscal to companies opting for equity routes including initial public offer (IPO), qualified institutional placements (QIPs) and offer-for-sale (OFS) to raise funds.
The fund-raising through the equity has been helped by a booming stock market. In the current fiscal so far, as many as 28 companies have raked in over Rs60,000 crore through IPO route. Indian equity market appears heading for a record haul in 2017-18 in terms of money raised through IPOs, as a number of big-ticket offers are already lined up for the coming weeks.