December 16, 2024
The 2024 figure more than doubled the INR 52,350 crore raised in the previous year, reflecting strong stock market conditions and investor confidence
A total of 82 companies utilised QIPs to raise capital this year, compared to just 35 firms raising INR 38,220 crore during the same period in 2023
Major contributors included Vedanta and Zomato, which raised INR 8,500 crore each, followed by Adani Energy Solutions, which raised INR 8,373 crore, and Varun Beverages, which raised INR 7,500 crore
Analysts predict further growth in December, with additional QIP fundraises projected to push 2024’s tally even higher
Fundraising through Qualified Institutional Placements (QIPs) has reached a historic milestone in 2024, surpassing INR 1 lakh crore for the first time in a calendar year. By November, Indian companies had raised INR 1,21,321 crore through this mechanism, marking a twofold increase from the INR 52,350 crore collected in 2023, according to Prime Database.
The remarkable growth in QIPs reflects the resilience of Indian capital markets, bolstered by strong stock market performance, higher valuations, and robust investor demand. Analysts suggest that companies have quickly leveraged these favourable conditions to secure capital, particularly given the speed and flexibility that QIPs offer to listed firms and investment trusts.
A total of 82 companies tapped into this fundraising method by November, a significant jump from the 35 firms that raised INR 38,220 crore during the same period last year. Among the notable fundraisers, Vedanta and Zomato led the way with INR 8,500 crore each, while Adani Energy Solutions and Varun Beverages followed with INR 8,373 crore and INR 7,500 crore, respectively. Other major contributors included Samvardhana Motherson International at INR 6,438 crore, Godrej Properties at INR 6,000 crore, and KEI Industries at INR 2,000 crore. State-owned Punjab National Bank, JSW Energy, and Prestige Estates Projects were prominent participants, using QIPs to strengthen their financial reserves.
QIPs have emerged as a preferred method for institutional fundraising, enabling companies to mobilise capital swiftly without needing pre-issue filings with regulators. Financial services firm JM Financial led the market as the top manager of QIP transactions in 2024, handling 16 issues. The firm’s Managing Director highlighted how the robust market conditions and their expertise in managing complex transactions had facilitated these record-breaking fundraises.
Analysts emphasised that the record QIP activity was driven by a confluence of factors, including strong secondary markets, abundant domestic liquidity, and positive investor sentiment. They noted that this year, QIPs, IPOs, and block trades saw unprecedented activity.
The resurgence of QIPs comes after a subdued 2022, when only INR 11,743 crore was raised through 14 issues, marking an eight-year low. This year’s resurgence not only underscores the confidence of institutional and retail investors but also reflects the broader resilience of the Indian stock market over the past four years.
Analysts expect this momentum to continue, with significant QIP transactions from companies like Torrent Power, Bharat Forge, Senco Gold, and Sammaan Capital scheduled for December. 2024 is poised to close as a landmark period for QIPs, further cementing India’s standing as a thriving hub for capital mobilisation.
Source: Economic Times