Firms garner Rs 92K cr via public equity issuance in Apr-Dec: Eco Survey

Indian companies garnered close to Rs 92,000 crore through public issuance of equity during April-December this fiscal, a 46 per cent jump from the preceding financial year, with rights issue remaining the most preferred route for financing business needs.

Companies had raised Rs 62,816 crore in the April-December period of 2019-20, according to the Economic Survey tabled in Parliament on Friday.

During April-December 2020, however, the number of companies raising money through public issue reduced to 33 from 49 in the same period last year, the survey noted.

Of the total Rs 91,993 crore mopped up through public issuance of equities in April-December 2020, Rs 60,907 crore was raised through 16 rights issues as compared to Rs 51,866 crore from 13 issues in April-December 2019.

 

With regard to private placement route, the survey mentioned that the year 2020-21 (up to December) witnessed a decline in fund raising through such route compared to the similar period for previous year. This could be attributed to lower fund mobilisation via preferential issue of equity shares.

In April-December 2020, there were 183 issues mobilising Rs 91,631 crore through private placement compared to 229 issues raising Rs 1,79,444 crore during the same period last year.

Within the private placement route, 21 qualified institutional placements (QIPs) raised Rs 64,148 crore during the period under review as compared to 9 QIPs that raked in Rs 34,028 crore in the April-December period proceeding fiscal.

A total of 162 preferential allotments raised Rs 27,483 crore, much lower than 220 such allotments that garnered Rs 1.45 lakh crore.

On the debt market front, the total debt issuance in primary market climbed by 30 per cent to Rs 5.99 lakh crore during the period under review from Rs 4.63 lakh crore in the corresponding period of the previous year.

During April-December 2020, the amount raised through private placement of debt accelerated by 32 per cent to Rs 5.95 lakh crore. However, the amount raised through public debt issues declined by 67 per cent to Rs 3,872 crore during the same period.