India cos garner Rs 2 lakh cr in 6 mths via debt placements

Fund-raising by India Inc through private placement of debt securities jumped by over 40% to cross the Rs 2 lakh crore mark in the first six months of the calendar year.

 

In debt private placements, firms issue debt securities or bonds to institutional investors to raise capital.

 

According to latest data available with market regulator Securities and Exchange Board of India (Sebi), Indian firms garnered a total of Rs 35,214 crore from the debt on a private placement basis route in June, higher than Rs 33,759 crore garnered in May.

 

In April, fund raising through private placement of debt securities had touched a nine-month high level of Rs 41,812 crore.

 

However, the number of issuances fell to 222 in June from 236 in the previous month.

 

"In the corporate debt market, Rs 35,214 crore were raised through 222 issues by way of private placement listed at BSE and NSE during June 2013 compared to Rs 33,759 crore through 236 issues in May 2013," the Sebi said.

 

Market experts believe that fund raising via private placement of debt have risen in June suggesting that companies opting for the route because of simple disclosure norms and weakness in rupee.

 

Of late, the Indian currency has been consistently hitting record lows and it slumped to a life-time low of 61.22 (intra-day) against the US dollar on July 8. Since April 30, the rupee has depreciated by over 10%.

 

Sebi, however, did not disclose the segment-wise fund raising details.

 

Overall funds raised by Indian companies has reached to Rs 2.08 lakh crore in the first half (January-June) of 2013. In comparison, firms had mopped up a total of Rs 1.46 lakh crore in the first six months of 2012.

 

In the financial year ended March 31, 2013, listed firms raised Rs 3.4 lakh crore through private placement of debt securities, the highest in five years. In 2011-12, companies had garnered Rs 2.10 lakh crore.