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India Inc's IPO, rights issue mop up falls 75% in June

During June 2011, Rs 1,195.6 crore was mobilised in the primary market through seven issues, compared to Rs 4,781.1 crore mobilised through five issues in May 2011.

twitter-logo PTI   Mumbai     Last Updated: August 5, 2011  | 11:41 IST

The quantum of funds mopped up by India Inc through IPOs and rights issues fell 75 per cent month-on-month to Rs 1,195.6 crore in June 2011, over the amount raised in May this year.

"During June 2011, Rs 1,195.6 crore was mobilised in the primary market through seven issues, compared to Rs 4,781.1 crore mobilised through five issues in May 2011, showing a decrease of 75 per cent over the previous month," said a 'Capital Market Review' by market regulator Securities and Exchange Board of India (Sebi).

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Of the seven issues in June, three were initial public offers (IPOs), three rights issues and one was a public issue.

Corporates had raised a total of Rs 4,781.1 crore through four IPOs and one follow-on public offer (FPO) in May.

IPO forms get shorter, simpler

Fund raising through IPOs and rights issues was quite good in 2010-11, with companies raising a total of Rs 67,608.6 crore.

Among the major fund raising exercises carried out last year was Coal India's public offer, which garnered over Rs 15,000 crore.

Sebi also said that only one listed company raised capital worth Rs 513 crore through Qualified Institutional Placement (QIPs) in June. In the previous month also there was only one single QIP which had raised Rs 55 crore.

IPOs fail to attract investors

The number of preferential allotments witnessed a decline in June, 2011, with 22 such allotments raising Rs 1,689 crore.

In contrast, in May, a total of 25 preferential allotments were executed in the primary market, raising a total of 5,931 crore.

In June, the stock market had seen a bit of downslide, with the benchmark Sensex losing over 4 per cent during the month.

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