Indian companies raised Rs 4.57 lakh crore through private placement of corporate bonds during the first 10 months of the current fiscal to meet business needs.
Going ahead, the debt market is expected to see further impetus on Sebi’s move, asking large firms to manage a fourth of their long-term funds from the bond market, Mukund Ranganathan, executive director at Motilal Oswal Investment Banking, said.
Firms raked in Rs 4,56,962 crore during the April-January period of 2018-19 via private placement of corporate bonds compared with Rs 4,87,764 crore garnered in the corresponding period of the previous fiscal, according to latest Sebi data.
In the whole of 2017-18, companies had raised 6 lakh crore through the route.
These funds have been raised mainly to expand business plans and support working capital requirements.
In terms of numbers, funds were raised through 1,955 issuance in the first 10 months of the current fiscal compared with 2,200 a year ago.
“The issuances by financial institutions to fund their lending requirement in addition to other corporates have been the mainstay of the debt market. Going forward, we see the debt market getting a further impetus after Sebi came out with guidelines that required large listed companies to raise at least 25 per cent of their long-term borrowings through corporate bonds, which is to come into force from April 1, 2019,” Ranganathan added.