Indian ECM proceeds fall 4.3% to $35.6 billion in CY21, shows data

The Indian equity capital markets (ECM) raised $35.6 billion in 2021, witnessing a 4.3 per cent YoY decline in proceeds, said Refinitv in its India Investment Banking Review 2021.  But there was 73.6 per cent growth in the number of ECM offerings.
 
The report said the funds raised through ECM deals fell because deals were of smaller values. Investment banking activities generated $1.1 billion in 2021, an 8.5% increase over the previous year and also the highest ever since records began in 2000.
 
Follow-on offerings, which accounted for 52 per cent of India’s overall ECM proceeds, raised $18.6 billion in 2021, showing a decline of 42.8 per cent from the year-ago period. This even as the number of follow-on offerings grew 21.4 per cent YoY.

Initial public offerings (IPO) hit record levels raising $16.6 billion in 2021, more than four times the amount raised in the previous year. The number of such offerings also grew 172.7 per cent YoY. Three-fourths of the IPO proceeds were raised during the second half of 2021, which saw 81 IPOs worth $12.5 billion. The fourth quarter IPO proceeds were at $7.4 billion —the highest-ever in a quarter. The third quarter IPO proceeds were $5.1 billion. One97 Communications was India’s largest IPO, raising $2.46 billion (Rs 18,300 crore).

ECM issuances from India’s financial sector accounted for most of ECM activity in India, with a 30.9 per cent market share worth $11.0 billion.
Telecommunications saw a 46.5 per cent increase in proceeds. The sector captured a 17.4 per cent market share, followed by materials — an 11.9 per cent share of India’s ECM activity.

ICICI Bank currently leads the ranking for India’s ECM underwriting with $3.9 billion in related proceeds and a 10.8 per cent market share. JPMorgan and Axis Bank rounded out the top three, capturing 10.5 per cent and 8.6 per cent market share, respectively.

ECM underwriting fees for the year were at $433.8 million, a 49.7 per cent increase from 2020. Debt capital markets (DCM) underwriting fees totalled $164.8 million, down 24.4 per cent from a year ago – the lowest since 2018. Completed M&A advisory fees grew 6.7 per cent from a year ago to $327.6 million. State Bank of India took the top spot in India’s investment banking fee league tables with a 7.8 per cent wallet share and $86.9 million in related fees.

Funds raised through DCM declined as primary bond offerings from India raised $58.6 billion in 2021 — 20.2 per cent less than the previous year and the least period since 2018. HDFC launched a $1.3-billion (Rs 10,000 billion) 10-year bond offering, the largest bond issuance from an Indian issuer in the year.

Indian issuers from the financial sector captured a 64.0 per cent market share worth $37.5 billion, down 14.9 per cent compared to 2020. Energy & power followed with a 15.2 per cent market share worth $8.9 billion, down 17.0 per cent from a year ago.