Indian companies raised more than Rs 33,000 crore in May through private placement of corporate bonds, a slump of 44 per cent from the year-ago level, for business expansion and propping up working capital needs. According to latest data available with markets regulator Sebi, firms garnered a total of Rs 33,389 crore in May 2017, lower than Rs 59,801 crore raised in the year-ago period. In April, firms had mopped-up Rs 63,819 crore through the route. In terms of numbers, 301 issues were made in May this year compared to 272 in the same month last year.
Overall, companies had raised Rs 97,207 crore through private placement of corporate bonds in the first two months of the current fiscal. Firms had raised a record Rs 6.41 lakh crore in the last financial year. These funds have been raked in mainly for expansion of business plans, repayment of debt and to support working capital requirements. Corporate bonds are debt instruments used by companies for the purpose of raising capital. These are called fixed- income securities because they pay a specified amount of interest on a regular basis. In a privately-placed bond issue, allocation is made to institutional investors.