Corporate India set to raise Rs 680b
Monday, 9 November 2009
NEW DELHI, (The Economic Times): Aluminium producer Hindalco, oil drilling firm Aban Offshore and Tech Mahindra, which bought the scandal-hit Satyam Computer, will lead a record fund raising by Indian companies through share sales to institutional investors in the next few months as they attempt to pare down debt accumulated during their takeovers.
Indian companies have approvals from shareholders to raise as much as Rs 680 billion by selling shares to institutional investors under the so-called qualified institutional placement route, a SundayET analysis based on data from SMC Capitals shows. This is in addition to around Rs 260 billion that has been raised by companies such as real estate developer Unitech and wind turbine maker Suzlon Energy in the last six months, thanks to a record stocks rally and signs of economic revival.
India Inc raised as much as Rs 264 billion in the last thirty-six QIP issues since March this year, according to the analysis.
These companies which raised funds in the last six months still have room to raise another Rs 230 billion based on the approvals shareholders have given them.
There are several companies which have received approval for QIPs between June and October with a potential to raise as much as Rs 440 billion, but are yet to hit the market.
Hindalco, which is saddled with debt after it acquired Canada's Novellis, plans to raise Rs 29 billion and Tech Mahindra plans to raise to partly repay the loan it took to buy Satyam Computer.
Essar Oil which is negotiating to buy Shell's refineries in the UK plans to raise around Rs 90 billion, whereas JSW Steel has a mandate raise Rs 48.5 billion Shareholders' approval is valid for a year and most of these companies took approval after June this year.
Indian companies have approvals from shareholders to raise as much as Rs 680 billion by selling shares to institutional investors under the so-called qualified institutional placement route, a SundayET analysis based on data from SMC Capitals shows. This is in addition to around Rs 260 billion that has been raised by companies such as real estate developer Unitech and wind turbine maker Suzlon Energy in the last six months, thanks to a record stocks rally and signs of economic revival.
India Inc raised as much as Rs 264 billion in the last thirty-six QIP issues since March this year, according to the analysis.
These companies which raised funds in the last six months still have room to raise another Rs 230 billion based on the approvals shareholders have given them.
There are several companies which have received approval for QIPs between June and October with a potential to raise as much as Rs 440 billion, but are yet to hit the market.
Hindalco, which is saddled with debt after it acquired Canada's Novellis, plans to raise Rs 29 billion and Tech Mahindra plans to raise to partly repay the loan it took to buy Satyam Computer.
Essar Oil which is negotiating to buy Shell's refineries in the UK plans to raise around Rs 90 billion, whereas JSW Steel has a mandate raise Rs 48.5 billion Shareholders' approval is valid for a year and most of these companies took approval after June this year.