Fund raising via primary market drops 72% in Sept: Sebi

Companies mopped up a total of Rs 1,477 crore in Sept, a slump from Rs 5,269 crore mobilised in Aug

Fund raising by Indian companies through the primary market route plunged by 72% to nearly Rs 1,500 crore in September over the preceding month.

This has left the cumulative fund mobilisation by companies for the first six-month period (April-September) of the current fiscal at Rs 9,130 crore as compared to Rs 8,987 crore raised during the year-ago period.

According to data available with market regulator Securities and Exchange Board of India (Sebi), companies mopped up a total of Rs 1,477 crore in September, a slump from Rs 5,269 crore mobilised in August.

Out of Rs 1,477 crore raised in September, a major chunk of the amount (Rs 1,386 crore) was garnered through debt route and the remaining Rs 127 crore via issuance of equity shares.

The amount raised through the equity segment during the month included five initial public offerings (IPOs) ACE Tours Worldwide Ltd, R J Bio-Tech, Satkar Finlease, Newever Trade wing and Subh Tex (India) Ltd listed on the small and medium exchange (SME) platform.

Also, a total of Rs 90 crore was mopped-up through rights issues by three firms -- Peirce Leslie India, Waterbase and Uniphos Enterprises.

Market experts said fund raising dropped in September over the preceding month due to volatile equity market conditions and most of the money was garnered through debt route.

The decline in fund mobilisation coincided with a 4% surge in the 30-scrip sensitive index (Sensex) during the period under review.

"During September 2013, Rs 1,477 crore were mobilised in the primary market (equity and debt issues) by way of 10 issues as compared to Rs 5,269 crore mobilised through 11 issues in August 2013, showing a decrease of around 72% from the previous month," Sebi noted.

In financial year 2012-13, companies had raked in Rs 32,455 crore via the primary market, the lowest since 2008-09 when they had garnered Rs 16,220 crore.