Editor: Mohammad Haris

Last updated: Feb 04, 2023 13:34 IST

Funds totaling Rs 3.92 million were withdrawn from the debt market.

Fiscal year 23 has been a good year for India’s capital market, although global macroeconomic and financial developments in the market have had some impact.

According to the latest Economic Review 2022-2023, Indian companies raised Rs 5.06 million from equity and debt between April and November 2022, down 8.5% from the same period last year. He added that debt fundraising contributed the lion’s share of the total fundraising for the period under review.

According to the data collected in the survey, funds totaling Rs 3.92 billion were taken out of the debt market and Rs 1.14 crore entered through equity. This is out of a total of Rs 5.06 million received in FY 23 (until November 2022).

For comparison, between April and November 2021, firms raised Rs 5.53 million, including Rs 3.71 million from debt and Rs 1.81 million from equity, totaling Rs 89,166 million from primary public offerings (IPO). According to the survey, India’s capital market has had a good year overall in FY23, although it has been slightly affected by global macroeconomic and financial developments.

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“Global macroeconomic uncertainty, unprecedented inflation, monetary tightening, market volatility, etc. have led to a deterioration in investor sentiment, leading to negative results in global capital markets in fiscal year 23,” the report says.

In the equities segment, funds mainly came from preferred share issue (Rs 54,414 crores), which is one of the fastest mechanisms for companies to raise funds during the period under review. This was much higher than the Rs 43,000 crore collected as part of the April-November 2021 itinerary. This was followed by an IPO route that helped 104 companies raise Rs 48,095 crores in the reviewed period compared to 76 firms that raised Rs 89,166. crore last year.

In addition to preferred share issues and IPOs, funds have also been raised through rights issuance and Qualified Institutional Placement (QIP). “Compared to fiscal year 22, the number of companies choosing to list their shares on exchanges increased by 37%, although the amount raised fell to almost half the amount received last year,” the study notes.

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Although the past year was not very good in terms of raising funds through IPOs, the number of SMEs that issued public offerings was very encouraging.

Compared to FY22 (until November 2021), this year not only has the number of SMEs that have gone public with IPOs almost doubled, but the total amount of funds they have raised is almost three times the amount they have raised in the same period last year .

In addition, this year also saw the largest IPO in Indian history. In May 2022, the central government diluted its stake in the Life Insurance Corporation (LIC) of India and listed it on the stock exchanges, thus making it the largest IPO in Indian history and the sixth largest IPO in the world in 2022.

Moreover, the LIC listing accounted for more than a third of the resources mobilized in the primary stock market through November 2022. Of the total Rs 3.92 million raised in the Indian debt markets in FY 23, Rs 3.85 million came from a private placement and Rs 6,624 crore was through a public issue. However, the lack of activity in issuing government debt was more than offset by the placement of private debt.

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The number of private debt placements increased by 11 percent from 851 to 945, and mobilized resources increased by 6 percent in April-November 2022 to Rs 3.85 million compared to Rs 3.62 million in the same period a year earlier. noted in the survey.

(According to PTI)

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