Cos raised Rs 34,000 cr via private placement of bonds in May

Fund-raising by India Inc through private placement of debt securities or bonds fell by 19% to nearly Rs 34,000 crore in May.

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

According to latest data available with the market regulator Securities and Exchange Board of India (Sebi), Indian firms garnered a total of Rs 33,759 crore from the debt on a private placement basis route in May, a decline from nine-month high level of Rs 41,812 crore garnered in April.

However, the number of issuances rose to 236 in May from 206 in the previous month.

"In the corporate debt market, Rs 33,759 crore were raised through 236 issues by way of private placement listed at BSE and NSE during May 2013 compared to Rs 41,812 crore through 206 issues in April 2013," the Sebi noted.

Market experts believe that fund raising via private placement of debt have slowed down, but the number of issues increased 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 new record lows and it slumped to a life-time low of 60.76 (intra-day) against the US dollar on June 26. Since April 30, the rupee has depreciated by over 10%.

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

With this, overall funds raised by Indian companies has reached to Rs 1.73 lakh crore since the beginning of the year. In comparison, firms had mopped up a total of Rs 1.2 lakh crore in the first-five month 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.