LSE's India equity pipeline among its strongest

The London Stock Exchange (LSE) group on Tuesday said its short-to-medium-term pipeline of Indian equity offerings remained one of the strongest among emerging markets.

The composition of the Indian fundraising pipeline was a mixture of share issues by large Indian multinationals on the Main market, global depository receipt (GDR) issues and smaller issues on London’s AIM market, LSE group said.

“We will see more equity listings from Indian companies than GDR listing in this year,” said Ibukun Adebayo, head of primary markets – India at LSE, in a press briefing. Floatations from Indian companies on both the main market and AIM market are expected from a diverse range of sectors, including energy, natural resources, manufacturing and services.

In view of strong interest from Indian companies, LSE group was holding road shows in Mumbai and Delhi this month in partnership with Amarchand Mangaldas, Arden Partners, Capital MSL, Citigroup, Ernst & Young, Kotak Investment Banking and Linklater, the firm said.

Indian companies raised $2.24 billion on the LSE in 2010, bettering the previous highest total of $1.9 billion in 2007. On the AIM market, Indian companies raised $343 million in 2010, more than any single country, accounting for 19 per cent of all money raised in the calendar year on the market.

So far in 2011, Essar Energy has raised $550 million on the LSE by issuing convertible bonds that were listed on the exchange in January. Apart from this, AIM quoted Greenko Group and Hirco have raised an additional $82 million and $19 million, respectively, in June.

There are currently 71 Indian or India-focused companies on LSE group’s markets. Collectively, these companies have raised over $8 billion in London.

Meanwhile, an LSE group survey of UK fund managers in partnership with Capital MSL conducted over the last two weeks revealed that 73 per cent of investors remain confident on the Indian growth story in 12-18 months time and rank India on par with Brazil and ahead of China as an investment destination. The survey researched the views of fund managers from 30 blue chip institutions in the UK and Europe that invest in emerging markets.

However, in the short term, only 5 per cent of respondents are confident for the next 6 months in their outlook for India due to concerns of high inflation and rising interest rates.