Mumbai : A record raising of over 800 corporates and institutions 8.3 trillion of funds through private placement of corporate bonds in FY23, amid high foreign borrowings and higher interest rates at home, according to Prime Database.
Private placement refers to a sale to pre-selected investors rather than an open market sale. The Prime Database holds data on the primary capital market.
It was raised by 855 institutions and corporates. Transactions, listed and unlisted, with tenor and put/call options of more than 365 days are considered.
According to Pranav Haldia, Managing Director, Prime Database Group, this happened due to a combination of factors like costlier overseas borrowings, increase in credit demand, higher bank lending rates and issuance of large amounts by some issuers.
According to primedatabase.com, the highest mobilization in the year was done in the All India Financial Institutions/Banks category. 4,17,323 crores. it was in comparison 2,68,413 crore in 2021-22, representing an increase of 55 per cent. Mobilization by the private sector (excluding banks/financial institutions) also saw an increase, rising to 12 per cent. 3,39,033 cr as against 3,02,985 crore in 2021-22.
Government organizations together raised 40 percent of the total amount, which is more than 34 percent in 2021-22. According to Primedatabase.com, among government entities, All India Financial Institutions/Banks led with 78 per cent share followed by PSUs with 17 per cent share.
The highest mobilization through debt private placement during the year was done by HDFC ( 78,415 crore) followed by NABARD ( 49,510 crore), PFC ( 42,097 crore), SBI ( 38,851 crore) and SIDBI ( 35,405 crore). Top 5 issuers raised for 2022-23 2,44,277 cr as against Rs 1,61,895 crore raised by top 5 issuers in 2021-22.
The maximum amount raised in the above 10 year maturity bucket was ( 2.92 lakh crore or 35 per cent of the total amount) followed by 3-5 year bucket ( 2.62 lakh crore or 32 per cent of the total amount).
about three-fifths of the total amount ( 4.93 lakh crore) was in the 7-8 per cent coupon range and 18 per cent of the total amount ( 1.47 lakh crore) was in the 8-9 per cent coupon range. This was in contrast to 2021-22, wherein only 21 per cent of the issue amount was in the 7-8 per cent coupon range, 6 per cent of the issue amount was in the 8-9 per cent coupon range, while a whopping 52 per cent was below the 7 per cent coupon range. Was.
as many issues 5.58 lakh crore or 67 per cent of the total amount were AAA rated.
On an industry-wise basis, the banking/financial services sector continues to dominate the market, growing collectively 6,17,534 crore or 74 per cent of the total amount. The housing/civil construction/real estate sector stood second with a share of 5 per cent ( 38,152 crore).
Most released in the month of December 2022 1,24,073 crore (14.9 per cent) by March 2023. 1,16,364 crore (14 per cent).
393 first-time issuers hit the market in 2022-23 as compared to 381 last year.
Outlook for 2023-24
According to Haldia, the pace of corporate bond issuance is likely to slow down given the recent taxation changes in debt mutual funds, which are large investors in the sector.
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