Fund raising via equity market route plunges 60% to `63,744 cr in 2018

New Delhi: Indian companies have raised Rs 63,744 crore through various equity market routes in 2018, a slump of 60 per cent from the all-time high of Rs 1.6 lakh crore garnered in the preceding year, according to data analytics major Prime Database.

Apart from equity, firms have also mopped up Rs 29,944 crore through public issuance of bonds during the year.

Out of the cumulative Rs 63,744 crore garnered through public equity markets in 2018, a large chunk or Rs 33,244 crore has been mopped up from initial public offers (IPOs).

Besides, qualified institutional placement (QIP) accounted for Rs 16,077 crore, offer-for-sale (OFS) through stock exchange mechanism got Rs 10,678 crore and Infrastructure investment trusts (InvITs) helped raise Rs 3,145 crore.

As per the report, 24 mainboard IPOs collectively raised Rs 30,959 crore. This was a decline from Rs 67,147 crore raised through 36 IPOs in 2017.

However, small and medium enterprise (SME) platform witnessed hectic activities in the IPO space, raising Rs 2,254 crore in 2018, much higher than Rs 1,679 crore collected last year.

According to Prime Database Managing Director Pranav Haldea, the overall response from the public to the mainboard IPOs in 2018 was good.

The largest IPO this year was from Bandhan Bank for Rs 4,473 crore. Many IPOs received mega response including that of Apollo Micro Systems, which was subscribed by 176 times, followed by Amber Enterprises (115 times), RITES (67 times), HDFC Asset Management (60 times), Galaxy Surfactants (14 times) and Bandhan Bank (11 times).

Of the 24 IPOs which got listed, Apollo Micro Systems gave a return of 65 per cent followed by HDFC Asset Management (65 per cent), Amber Enterprises (44 per cent), Lemon Tree Hotels (28 per cent), Bandhan Bank (27 per cent) and 15 per cent each by RITES and Galaxy Surfactants.

However, given the correction in the markets in the second half of the year, 15 of the 24 IPOs are presently trading below the issue price.

Going into 2019, not too much action is expected in the first half of the year till the conclusion of the general elections, despite the fact that the IPO pipeline is huge, as 59 firms already have Sebi's approval for Rs 63,170 crore-IPO and another 19 companies looking to raise Rs 18,067 crore are awaiting the regulator's go-ahead, Haldea added.

The report said fund raising through OFS fell to Rs 10,678 crore in 2018 from Rs 18,094 crore last year. The largest OFS was that of Coal India in October this year (Rs 5,274 crore) followed by Larsen & Toubro Infotech (Rs 1,846 crore).

A total of 25 companies mobilised Rs 16,677 crore through QIPs. This was 73 per cent lower than Rs 61,148 crore raised in the previous year. The largest QIP of 2018 was from Idea Cellular that raised Rs 3,500 crore.