Fundraising via preferential route down 21%

Funds raised by listed firms through preferential allotment stood at Rs 37,900 crore

Indian companies garnered nearly Rs 38,000 crore through issuance of shares to promoters and shareholders on preferential basis in 2016, a plunge of 21 per cent from the previous year.

The funds have been mobilised for business expansion, refinancing debt, working-capital requirements and general corporate purposes.

Preferential allotment serves as an alternative mechanism of resource mobilisation, where a listed firm issues shares or convertible securities to a select group of shareholders on a private placement basis. Going by the latest data available with the Securities and Exchange Board of India (Sebi), funds raised by listed firms through preferential allotment stood at Rs