PSUs hog 66 per cent of equity offering in current fiscal

The mobilisation this year could have been higher but for the continuing volatility in the secondary market and poor post-IPO performance of some companies in the early part of the year. However, the collection in 2009-10 is much lower than Rs 52,219 crore, the highest amount that had been raised ever, in 2007-08.

Interstingly, while the private companies took a back seat, PSUs dominated the year with a total raising of Rs 30,942 crore or 66 per cent of the total amount, Haldea said. This was the highest ever amount mobilised by PSUs.

Of the total amount, Rs 21,162 crore was through divestments and Rs 9,780 crore through fresh capital issue. A total of six PSUs entered the market during the year and most prominent issues were NMDC (Rs 9,791 crore), NTPC (Rs 8,480 cr) and NHPC (Rs 6,039 cr).  According to PRIME, after several years, the mobilisation was almost equally shared by IPOs and FPOs. A total of 39 IPOs collectively raised Rs 24,924 crore or 53 per cent of the total amount (compared to 21 IPOs in the preceding year raising Rs 2,034 crore). The amount raised through FPOs stood at Rs 21,854 crore through five companies, compared to none in the preceding year.

Fresh capital and offers for sale almost had an equal share at Rs 24,522 crore and Rs 22,256 crore respectively.  The number of issues hitting the market recorded a huge 110 per cent increase. The year 2009-10 witnessed 44 public issues, compared to 21 in the previous fiscal. The year saw a demise of small issues as there was no issue of below Rs 10 crore.

As per PRIME, in terms of method of offering, all issues of the year were through the bookbuilding route, signifying a near-demise of the fixed price method. The year also witnessed the introduction of the French Auction system, which was used by NTPC and REC.

Unlike the previous year, this fiscal did not witness a revival of the regional stock exchanges as all 44 issues went for listing at BSE/NSE. In addition to equity issues, the year also saw three public bonds issues, raising a total amount of Rs 2,250 crore.