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Funds raised by Indian companies through retail issues of non-convertible debentures (NCDs) more than halved to nearly Rs 17,000 crore in 2012-13, even as the capital mopped up through this route exceeded the targets.
According to latest data available with the market regulator SEBI (Securities and Exchange Board of India), a total of 15 companies, including India Infrastructure Finance Company and Rural Electrification Corp, raised Rs 16,982 crore collectively via NCD route in the past fiscal.
In comparison, a cumulative amount of Rs 35,611 crore was garnered by 16 firms through their NCDs in the preceding year.
Non-Convertible Debentures are loan-linked bonds issued by a company that cannot be converted into stock and usually offer higher interest rate than convertible debentures.
Most of the funds were raised to support financing activities and to meet working capital requirements.
Four companies – Indian Railways Finance Corporation (IRFC), Housing and Urban Development Corp (HUDCO), Rural Electrification Corporation (REC) and Power Finance Corp (PFC) tapped the NCD route twice in the financial year ended March 31, 2012.
Also, these 15 companies garnered more than the targeted amount of Rs 13,775 crore through issuance of NCDs.
Barring Power Finance Corp (first tranche), Ennore Port Ltd, Jawaharlal Nehru Port Trust, Dredging Corporation of India Ltd, National Housing Bank and IRFC (second tranche) and HUDCO ( second tranche), all the other issues managed to raise more than their targetted amounts.
In 2011-12, the companies had raised Rs 35,611 crore, as against their targeted amount of Rs 31,100 crore.
Individually, IRFC raised raked in a total of Rs 5,373 crore last fiscal, as against the base size of Rs 1,000 crore and India Infrastructure Finance Company mopped-up Rs 2,884 crore against the target of Rs 1,500 crore.
Besides, HUDCO raised Rs 2,194 crore against the base size of Rs 750 crore, while REC garnered Rs 2,017 crore against the target of Rs 1,000 crore.
Shriram Transport Finance Company Ltd and India Infoline Finance Ltd raised Rs 600 crore and 500 crore respectively, which were twice their base sizes.
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