Indian firms raise $14 Billion through debt papers
By siliconindia   |   Wednesday, 08 April 2009, 15:55 IST   |    1 Comments
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Chennai: Indian firms have raised $14 billion from domestic primary market in the last fiscal, through debt papers. According to a study, almost 99 percent of the money raised through debt came from of non-convertible debentures (NCDs) in 2008-09. Some of the companies which opted for this route include Tata Capital where it raised $300 million while others such as SKS Microfinance used the NCD route to raise smaller monies, reports The Times of India. The findings from the CMIE data reveals that resources raised through debt papers rose 46.7 percent to $13.95 billion in the 12 months from $9.51 billion in 2007-08. During April-November 2008, LIC invested around $4.6 billion in NCDs on private placement basis and could have invested at least another $2-3 billion in the remaining months of this fiscal, market sources said. This shows the rise as well as the acceptance of debt instruments as investors flock towards assured returns. With debt's appeal increasing, even foreign institutional investors, known for their exploits in the stock market, were net buyers of debt securities to the tune of $500 million in FY08. "With equity markets in a downturn, both globally and domestically, debt was a safer option for many long-term investors," C Venkat Subramanyam of Veda Corporate Advisors said. According to CMIE data, resources mobilised from the domestic primary equity-linked routes fell 77 percent to $5.8 billion when compared to around $26 billion in the previous fiscal as the appetite for public issues, right issues and private placement diminished. Public issues or IPOs raised a dismal $705 million in April '08 to March '09 period as against nearly $10 billion raised by companies in the same period, a year before.

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