Share issues raise record money in 2010

In 2010 Indian companies raised a record Rs 71,114 crore from 70 public issues of shares and this was a whopping 58 per cent higher than the next best of Rs 45,000 crore raised in 2007.

According a report compiled by Delhi-based SMC Global Securities Limited, there were 62 IPOs (initial public offer) and 8 FPOs (follow-on public offers) in 2010. These 62 IPOs raised funds to the tune of about Rs 39,710 crores and 8 FPOs to the tune of about Rs 31,403 crores. So the share of IPOs in total fund collection was 56 per cent and that of FPOs was 44 per cent. The smallest public issue of the year 2010 was Thangamayil Jewellery IPO with the issue size of Rs 29 crores and the largest IPO of the year was that of public sector Coal India Ltd (CIL) with the issue size exceeding Rs 15,000 crores.

Incidentally CIL’s IPO has also made history being the largest public issue in the Indian capital market.

Explaining the reasons for a spectacular year of fund raising SMC Global Securities Ltd Strategist & Head of Research, Jagannadham Thunuguntla said “The year saw many good quality issues like Coal India and MOIL. The inflow of foreign funds through FIIs was also good.” Though many issues did not do well after listing, on the whole a bullish secondary market did help in boosting investors’ sentiments, he added. 

The public issues were seen across the industries such as power, minerals, infrastructure, banking, healthcare, realty, etc. Further, one more special feature of the 2010 primary market was that, the public issues can be seen from the new-age modern industries such as Microfinance, Fitness Centers, etc.

Another interesting highlight in 2010 was that the fund raised by public issues from public sector enterprises at Rs 49,946 crore was more than double of Rs 21,168 crore raised by private sector companies. PSU’s thus accounted for the lion’s share of 70 per cent in the capital raised, added Thunuguntla.

Another record created in 2010 is in terms of number of applications received for public issues. The Coal India IPO for example got a record 16.65 lakh applications, Power Grid FPO got 14.28 lakh and Manganese Ore IPO has got 13.02 lakh applications.