New Delhi, Jan. 13 (PTI): Listed companies have mopped up Rs 3.36 lakh crore — the highest in five years — through private issue of debt securities in 2012 as relaxed norms and the weak rupee increased the appetite of corporate houses.
In private placement of debts, firms issue debt securities, or bonds, to institutional investors to raise capital.
According to data available with the Securities and Exchange Board of India, listed firms raised Rs 3,36,396 crore in 2012 through private placement of debt securities, a robust hike from Rs 2,10,869 crore garnered in the preceding year.
Data for funds mopped up before 2007 by listed companies via private placement of debt securities are not available. In 2007, Rs 1.05 lakh crore was raised via this route.
In 2012, the number of issues stood at 2,338 from 1,509 in the preceding year.
According to analysts, increased investment limits in bonds for foreign institutional investors (FIIs), simple disclosure norms and the weak rupee have prompted firms to opt for the private placement of debt.
“The steps taken by Sebi are positive as the higher debt private placements could be in the interest of FIIs,” Geojit BNP Paribas research head Alex Mathew said.
The government has increased FII limits in government securities and corporate bonds by $5 billion each, taking the total investment limit in domestic debt to $75 billion.