Indian companies raised Rs 9,594 crore through rights issue last fiscal, an increase of 15 per cent vis-a-vis 2009-10 mop-up, primary market tracking firm Prime Database has said.

“Mobilisation of resources through rights issue recorded a 15 per cent increase in the recently concluded fiscal 2010-11... By amount, the year saw Rs 9,594 crore being raised, compared with Rs 8,321 crore that was raised in the previous year 2009-10,” the Prime Database CMD, Mr Prithvi Haldea, said in a statement today.

However, the amount mopped up is lower than Rs 12,622 crore raised in 2008-09 and much lower than Rs 32,519 crore mobilised in 2007-08.

In terms of the number of rights issues, the fiscal witnessed only 24 companies adopting the route to raise funds, 17 per cent lower than the previous fiscal, which saw 29 issues.

The largest rights issue during the fiscal was by Central Bank of India (Rs 2,498 crore). The other Rs 1,000-crore plus issues were by Suzlon Energy, REI Agro and EIH.

Significantly, nearly 50 per cent of the mobilisation, at Rs 4,776 crore, was done by banks. In addition to Central Bank of India, rights issues were floated by State Bank of Bikaner and Jaipur (Rs 780 crore), State Bank of Mysore (Rs 583 crore), Karur Vysya (Rs 458 crore) and Karnataka Bank (Rs 457 crore).

“The manufacturing and services sector preferred increasingly to use the QIP and the preferential issue route,” Prime Database added.

The new fiscal (2011-12) promises some action on the rights front. According to Prime Database, 32 companies have already applied for or have obtained SEBI approval for raising Rs 1,781 crore.

In addition, there are at least another 40 companies who have in the last six months announced their plans to tap the rights market and may firm up their plans in the near future.

The plans of all these companies are, of course, subject to a stable, if not a buoyant, secondary market.

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