Annus Mirabilis for Equity Market

Published: 31st December 2015 03:28 AM  |   Last Updated: 31st December 2015 03:28 AM   |  A+A-

CHENNAI: Indian companies have mopped up over Rs 68,608 crore through the equity market route in 2015, which is 76 per cent higher than the Rs 39,067 crore raised in 2014, according to Prime Database.

According to the market research firm, 2016 looks promising with as many as 20 companies getting Sebi's nod to raise Rs 7,315 crore, with 11 more on the wait-list to mop up Rs 5,445 crore.

During 2015, offer-for-sale (OFS), typically used to dilute promoters' holdings, emerged as the most-preferred way to mobilise capital among businesses comprising 52 per cent of the overall funds raised through public issuance of equities. Companies mobilised Rs 35,564 crore through the OFS route, higher than Rs 5,000 crore in 2014.

Of the total Rs 68,608 crore raised, fresh capital accounted for only Rs 25,964 crore, with the remaining Rs 42,644 crore coming from OFS, via the stock exchange mechanism, Qualified Institutional Placement (QIP) and IPO.

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“The year could have been even better but for the deferment of several PSU offerings. The year, of course, fell short of Rs 97,746 crore, the highest amount which has ever been raised (in 2010),” said Pranav Haldea, MD, Prime Database. This was due to the government's divestment proceeds of Rs 35,291 crore. The largest OFS was that of Coal India, which fetched Rs 22,558 crore followed by Indian Oil (Rs 9,396 crore). Besides, firms garnered Rs 19,182 crore through the QIP route, nearly half of what they raised in 2014 at Rs 31,684 crore.

Meanwhile, the IPO market saw a turnaround after four disappointing years. Despite turbulent secondary markets, 21 main-board IPOs came to the market collectively raising Rs 13,602 crore. The highest-ever mobilisation through IPO was in 2010 at Rs 37,535 crore. On the other hand, five IPOs had hit the capital market to garner just Rs 1,201 crore in 2014. The largest IPO came from InterGlobe Aviation for Rs 3,017 crore, with the average deal size at Rs 648 crore.

The year 2015 also witnessed activity among SMEs with as many as 43 firms launching IPOs and collected Rs 260 crore as against 40 with Rs 267 crore last year.

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