Equity fund raising during Sept quarter falls 45% y-o-y

Written by fe Bureau | Mumbai | Updated: Oct 15 2014, 06:37am hrs
Indias equity fund raising stood at R3,612 crore in the first half of this fiscal, down 45.89% from the corresponding period last year, according to capital market data provider Prime Database.

A meagre 18%, or R661 crore, of the total fund raising was through fresh capital, while the balance amount was raised through secondary market offerings where the proceeds go to the sellers government, promoters, venture funds and other investors and not to the company.

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Mobilisation through initial public offerings (IPOs) stood at R1,019 crore, down 3% from the same period last fiscal. However, the number of companies using the IPO route increased to 25 in the first six months, compared to 16 last year.

Even though a bullish sentiment has prevailed in the market, because very few predicted a landslide victory for NDA of the sort which was witnessed and because the IPO process is time-consuming, there will be a lag of a few months before large ticket IPOs hit the market, said Pranav Haldea, managing director, Prime Database.

Haldea said many companies will tap the IPO route in the second half, especially the fourth quarter of this fiscal, as recent success of IPOs in terms of over-subscription as well as listing gains have boosted sentiments.

Five companies planning to raise R1,240 crore hold approval from the Securities and Exchange Board of India (Sebi).

Another 11 companies, with a plan to raise R4,707 crore, have filed with Sebi and are awaiting approval.