India Inc raises Rs 1 trillion via corporate bonds

India Inc has raised a record over Rs 1 trillion through issue of corporate bonds on private placement basis in fiscal 2007-08, driven by huge mobilisations by financial institutions and banks, a latest report says.

According to data complied by capital market data provider Prime, the funds raised have increased substantially to Rs 1,15,266 crore last fiscal from Rs 93,855 crore in FY 2006-07, a jump of over 23 per cent.

Financial Institutions and banks' fund raising through private placement of corporate debt went up by 27 per cent to Rs 90,164 crore last year from Rs 71,193 crore a year-ago, a Prime statement said.

The other sectors which witnessed a significant growth was the private sector, whose mobilisation went up by 49 per cent to Rs 21,689 crore from Rs 14,540 crore in 2006-07.

The mobilisation by state level undertakings also grew by 79 per cent to Rs 1,348 crore in the reviewed year from Rs 752 crore in the previous year and state financial institutions by 10 per cent to Rs 1,309 crore as against Rs 1,192 crore in the previous year, the statement added.

On the other hand, a major fall in mobilisation came from PSUs, down by 88 per cent to only Rs 756 crore, compared to Rs 6,178 crore in the previous year.

Government organisations and financial institutions, put together, witnessed a decline, mobilising 81 per cent of the total amount, down from 85 per cent in the previous year, it added.

Among government organisations, all-India financial institutions/ banks led with a 78 per cent share, followed by a one per cent share by State Financial Corporations (SFC), a one per cent share by PSUs, and a one per cent share by state level undertakings.

"On an industry-wise basis, the financial services sector continued to dominate the market, raising Rs 1, 04,473 crore or 90 per cent of the total amount. Power ranked second with a three per cent share (Rs 3,468 crore), followed by diversified (Rs 2,250 crore)," Prime database Managing Director Prithvi Haldea said.