Fundraising via equity issues jumps 116% to ₹1.78 lakh crore in 2020
The devastating pandemic failed to dampen the primary, secondary capital market issuances with the year closing with the highest ever fundraising from the equity markets, that grew at 116% to ₹1.78 lakh crore in IPOs, OFS and other market issuances
The devastating pandemic failed to dampen the primary and secondary capital market issuances with the year closing with the highest ever fundraising from the equity markets, that grew at 116% to ₹1.78 lakh crore in IPOs, OFS and other market issuances, according to a report.
Despite the entire 2020 being overshadowed by the pandemic, an all-time high fundraising through public equity markets at ₹1,77,468 crore. This was 116% higher than ₹82,241 crore was raised in 2019, according to Pranav Haldea, managing director at Prime Database.
The previous highest amount raised in a calendar year was ₹1,60,032 crore in 2017.
Strong retail participation in IPOs, huge listing gains and highest-ever amount raised through QIPs and InvITs/REITs were the key highlights of the year, he said.
While IPOs fetched ₹26,770 crore, which was 40% higher than collected in 2019, FPOs netted ₹15,024 crore, followed by OFS (offer for sale) at ₹21,458 crore and REITs/InvITs/QIPs at ₹84,501 crore, shows the report.
Of the last category, REITs/InvITs constituted ₹29,715 crore, totalling the entire equity capital raising at ₹1,77,468 crore in the year.
Including ₹7,485 crore bond issuance, the total capital raising stood at ₹1,84,953 crore, according to the report.
As against this in 2019, the total IPO market was a paltry ₹12,985 crore, and including ₹18,637 crore of bond sales, the total equity capital raising was ₹1,00,878 crore. In 2018, the IPO market was better at ₹33,246, yet the total fundraising was only ₹93,352 crore
But the best year for IPOs was 2017 when as much much as ₹68,827 crore was collected through this route, taking the total ₹1,60,032 crore.
According to Haldea, contrary to the despondency due to the pandemic, 15 main-board IPOs came to the market collectively raising ₹26,611 crore. This was an increase of 115% from the ₹12,362 crore raised through 16 IPOs in 2019 and 24 issued raised ₹30,959 crore in 2017 and 36 issuances mopped up ₹67,147 crore in 206.
The largest IPO in 2020 was from SBI Cards for ₹10,341 crore. Five of the 15 IPOs had a prior PE/VC investment.
Offers for sale by such PE/VC investors combined stood at ₹8,026 crore accounted for 30% of the total IPO amount. Offers for sale by promoters at ₹7,880 crore accounted for a further 30% of the IPO amount.
Of the 15 IPOs, 13 had anchor investors, which collectively subscribed to 29% of the issue.
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