Amount raised through public equity up 76% y-o-y: Prime Database

Total mop-up through all IPOs, OFS, QIPs amounted to Rs 68,608 cr

Indian corporates mopped up nearly Rs 70,000 crore by way of Initial Public Offerings (IPOs), offer for sale (OFS), and qualified institutional placement (QIPs) — 76 per cent higher than the previous year, said a study. Notably, the follow-on public offering and institutional placement programme (IPP) routes were not used by firms this year.

The total mop-up through all these routes amounted to Rs 68,608 crore, up from Rs 39,067 crore raised in 2014, according to Prime Database. The year could have been better but for the delay of several public sector unit (PSU) offerings, said Prime Database.

Of Rs 68,608 crore, the amount raised through fresh capital was only Rs 25,964 crore, with the remaining being OFS. It was a good year for the IPO market, with 21  IPOs collectively raising Rs 13,602 crore. The largest IPO was from InterGlobe Aviation for Rs 3,017 crore. The average deal size was a high Rs 648 crore. OFS by private equity and venture capital investors at Rs 1,937 crore accounted for 14 per cent of the total IPO amount.

Nineteen companies had anchor investors that collectively subscribed to 30 per cent of the total public issue amount. The domestic institutional investors played a significant role as anchor investors, with their subscription amounting to 13 per cent of the amount, compared to 16 per cent from foreign institutional investors.

According to PRIME, OFS through stock exchanges rose to Rs 35,564 crore from Rs 5,000 crore last year. This was almost entirely accounted for by the government’s divestment at Rs 35,291 crore. The largest OFS was that of Coal India in January (Rs 22,558 crore) followed by Indian Oil in August (Rs 9,396 crore). OFS contributed to 52 per cent of the amount raised through the public equity markets.

The amount mopped up through QIPs in 2015 dipped to Rs 19,182 crore from Rs 31,684 crore in the previous year. The largest QIP of 2015 was from IndusInd Bank, which raised Rs 4,328 crore.

“A big disappointment for the primary market has again been the lack of divestments by the government. While a good start was made with Rs 35,000 crore being raised in the first eight months, the remaining months of the calendar year did not see even a single divestment hitting the market,” said Pranav Haldea, managing director, Prime Database.

According to Haldea, 2016 might also be a good year for the IPO market. There are 20 companies holding the approval of the Securities and Exchange Board of India (Sebi) wanting to raise Rs 7,315 crore. Another 11 companies wanting to raise Rs 5,445 crore await Sebi’s approval. Many more filings are expected soon.