India Inc on fund raising spree amid pandemic, garners Rs 3.46 lakh cr

In the midst of a difficult economic environment caused by the Covid-19 pandemic, India Inc has raised a massive Rs 3.46 lakh crore in the five months between April and August.

An analysis by Antique Stock Broking on fund raising by companies in 2020-21, finds that Reliance Jio raised the lion's share at Rs 1.52 lakh crore, while Reliance Industries Ltd (RIL), through its rights issue, raised Rs 53,135 crore.

The fund raising has happened through different routes like stake sale in a private company such as the case of Reliance Jio, initial public offer (IPO)/follow on public offer (FPO), qualified investors placement (QIP), offer for sale (OFS), secondary sale by promoters and private equity and rights and preference issues.

After Reliance Jio, the big chunk of funds raised came from rights and preference issue where also RIL dominated. Of the total Rs 65,442 crore rased, RIL raised Rs 53,135 crore. Mahindra and Mahindra Financial Services raised Rs 3,100 crore.

In the preference issue category, Indusind Bank raised Rs 3,288 crore.

Another big chunk of fund raising has come from the QIP route with banks and financial institutions dominating. This route raised Rs 61,955 crore for India Inc.

While ICICI Bank raised Rs 15,000 crore, HDFC Ltd raised Rs 14,000 crore, Axis Bank  Rs 10,000 crore, HDFC NCD issue raised Rs 9,000 crore, Kotak Mahindra raised Rs 7,460 crore, and PI Industries Rs 2,400 crore, among others.

The secondary sale route by promoters and private equity has raised Rs 34,652 crore. The big secondary sales by promoters include Bandhan Bank (Rs 10,000 crore), Bharti (Rs 8,433 crore), Kotak Bank (Rs 6,944 crore), HDFC Bank (Rs 1,000 crore), and Ultra Tech Cement (Rs 126 crore).

The big sales by private equity have been in Embassy by PE fund Blackstone to raise Rs 2270 crore and by Carlyle in Metropolis for Rs 760 crore.

Under the OFS route, HAL raised Rs 5,000 crore while HDFC AMC raised Rs 2,835 crore and HDFC Life raised Rs 1,985 crore among others.