Credit squeeze impacts fund raising by India Inc

The credit crisis that hit the world markets impacted the fund raising by Indian companies during the first 10 months of the last financial year, a Ficci-Ernst & Young report said.

The amount of funds raised between April 8 and January 9 was only about $36 billion or Rs 1,80,000 crore against $84 billion or Rs 4,20,000 crore raised during 2008, the report said.

Indian companies raised a major portion of funds through external commercial borrowings (ECB) followed by domestic debt and equity route during the 10 month period, it said.

The funds raised through ADR\GDRs and FCCBs or foreign currency convertible debenture route have been negligible, according to the report.

About 80 per cent of the funds were raised by way of debt and only 20 per cent were raised through equity during the period.

The ratio of funds raised through debt has been highest in the last five years.

The funds raised through domestic resources, both equity and debt, were worth $19 billion or about Rs 95,000 crore while funds raised overseas were to the tune of $17 billion or about Rs 85,000 crore, the report added.