Indian companies raised a record Rs 1.13 trillion through Qualified Institutional Placements (QIPs) in 2024, marking the highest-ever fundraising through this route in a calendar year. This figure represents a threefold increase compared to the Rs 38,220 crore raised by 35 companies during the same period in 2023.
The previous record, set in 2020, saw 25 companies raise Rs 80,816 crore via QIPs. Notably, 80 companies contributed to the 2024 milestone, highlighting a significant surge in participation.
Potential To Cross Rs 1.21 Trillion
With ongoing QIPs from real estate developer Godrej Properties and cable and wire manufacturer KEI Industries worth Rs 8,000 crore, the total fundraising for the year could rise to Rs 1.21 trillion.
Market Conditions Fuel Fundraising
Independent market analyst Ambareesh Baliga attributed the record fundraising to favorable secondary market conditions and high liquidity levels. “Promoters leveraged the buoyant markets to secure funds for future growth,” he explained.
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By October 2024, 77 companies had raised Rs 96,321 crore through QIPs. August 2020 still holds the record for the highest amount raised in a single month, with six companies mobilizing Rs 39,032 crore.
Deployment Of Funds
Most companies used QIP proceeds for repayment or pre-payment of debts, strengthening their balance sheets to capitalize on growth opportunities. Funds were also allocated to capital expenditure and general corporate purposes.
“QIPs thrive in bullish markets with high valuations, offering companies a chance to raise equity with minimal dilution,” noted Manish Goel, founder and managing director of Equentis Wealth Advisory Services.
Key Transactions In 2024
- Zomato: The food delivery platform raised Rs 8,500 crore, using the funds for dark stores, warehouses, branding, and technological infrastructure.
- Godrej Properties: The real estate major launched a Rs 6,000 crore QIP for land acquisition and general corporate purposes.
- Adani Energy Solutions: Raised Rs 8,373 crore, the largest QIP in the Indian power sector.
- Vedanta: Mobilized Rs 8,500 crore earlier in the year.
- Samvardhana Motherson International: Secured Rs 4,938 crore through QIP.
Strong Activity In H2 CY24
Since July 2024, 42 companies have raised Rs 72,293 crore, accounting for 69% of the year’s total QIP fundraising. This activity occurred even as the BSE Sensex remained flat at around 79,000, correcting 8% from its September peak of 85,978.25.
Looking Ahead To CY25
Experts anticipate continued interest in QIPs, contingent on market conditions. “Buoyant markets will ensure the accessibility of QIP for firms,” said G Chokkalingam, founder of Equinomics Research.
Manish Goel predicted an additional Rs 1.5 trillion in QIP fundraising in the coming months, stating, “It feels like the town’s best auction is in full swing, with promising businesses on offer.”
Godrej Properties QIP Details
Mumbai-based Godrej Properties Limited (GPL) plans to raise Rs 6,000 crore through a QIP of 23.1 million shares at an indicative offer price of Rs 2,595 per share, representing an 8.3% equity dilution. The lock-up period for shares is 30 days, according to Bloomberg.
This record-breaking year underscores the strong confidence in India’s equity markets and the growing appetite of institutional investors for high-quality offerings.
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