It rained money in the primary market in 2010 as public equity issues -- both initial public offers (IPOs) and follow-on public offers (FPOs) -- made for a record mobilisation.
The issues between them raised R69,192 crore according to industry research firm Prime Database. This is three and a half times higher than the previous year (R19,567 crore) and 53% higher than the earlier record year of 2007 (R45,142 crore).
“This huge raising was possible because of the concerted and successful PSU issue programme,” said Prithvi Haldea, MD, Prime Database.
Three public sector IPOs and six FPOs — through disinvestment of R42,056 crore and fresh capital raising of R6,951 crore — collectively realised R49,007 crore. PSUs accounted for around 72% of the year’s mobilisation.
However, Haldea cautioned against reading too much into the issues. “It’s a misnomer to say that the frenzy or rush for the issues is back by just by taking amount raised as the parameter because in terms of number of issues we are still very far from the level seen in 2006 and 2007.”
In terms of the number of issues, the year closed at 72, over 3 times higher than 21 in 2009, though much below 106 issues that hit the market in 2007. The year also saw the country’s largest-ever IPO from Coal India for R15,199 crore, which single-handedly accounted for 22 % of the year’s total mobilisation.
A year dominated by large issues, 2010 saw as many as 13 issues of over R1,000 crore each, accounting for over 80% of the year’s mobilisation.
The top 5 public sector issues apart from Coal India included NMDC (R9,930crore), NTPC (R8,480 crore), Power Grid (R7442 crore) and REC (R3,530 crore). The largest private sector issue was from Jaypee Infratech (R2,262 crore).