New Delhi: After hitting the 21,000 mark in January, the Indian markets plummeted to 9000 levels in December. With the reversal in market fortunes, Indian companies also saw their sources of capital drying up and turned to the debt markets. According to Prime Database managing director Prithvi Haldea, 54 companies issued notices inviting deposits from the public in 2008, against only 11 companies in 2007.
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In 2008, IPO volumes fell by 51% to around Rs19,360 crore (till 10 December). This was against nearly Rs40,000 crore that companies raised via IPOs in 2007 as per a study by NexGen Capitals. If Reliance Power’s 12,000 crore IPO is excluded, the decline is even sharper.
Haldea holds that FIIs will stay away from the Indian markets for now. However, companies may be able to raise money by issuing corporate bonds, a source of fund that has not been much in use till now.