Equity fundraising via QIPs, rights issues slump to lowest since 2016

Some investment bankers argued that the reason for tepid fundraising through QIPs and rights could also be due to the fact that companies this year were not in need of large capital

Equity fund-raising through qualified institutional placements (QIPs) and rights issues slumped to the lowest since 2016 owing to a cloudy market environment and a lack of need for growth capital. In 2022, companies raised Rs 11,743 crore and Rs 4,052 crore through QIPs and rights issues, respectively.

Listed companies prefer QIPs for raising fresh capital. Due to their funding requirements, financial firms are large issuers of QIPs. “QIP is directly linked to the markets. Volatility in markets makes it difficult to price a transaction,” said Pranjal Srivastava, partner, investment banking, Centrum Capital.

So far this year, the benchmark Sensex gained 4.9 per