Keeping pace with the strong economic growth, Indian companies are set to raise a record Rs 45,000 crore (Rs 450 billion) through public offer of shares in 2006 as they expand both domestically and globally.
"The current pipeline is already Rs 85,000 crore (Rs 850 billion) strong and is building up by the day. However, all of this will not mature within 2006 and it is estimated that the year may have public issues of about Rs 45,000 crore," Prime Database managing director Prithvi Haldea said.
Haldea said this will be the highest-ever amount raised in a year, the previous highest being Rs 30,511 crore (Rs 305.11 billion) in 2004.
The calendar year 2005, despite an extremely bullish secondary market and a high-return primary market, had ended with a lower mobilisation of Rs 22,754 crore (Rs 227.54 billion), the second highest.
The estimate of Rs 45,000 crore for 2006 will substantially depend on PSU divestments and PSU issues. In 2004, the PSUs had led the mobilisation effort with Rs 20,218 crore (Rs 202.18 billion) out of a total of Rs 30,511 crore.
But 2005 was a disappointment for the primary market as not a single divestment by the government took place.
The 2006 pipeline includes several PSUs like Air India, Bharat Earth Movers, Gujarat State Energy Generation, Gujarat State Petroleum, Gujarat State Petronet (hitting the market in January), Indian Airlines, Power Finance, Power Grid and Shipping Corporation of India.
If the Left softens its stand in 2006, many divestment issues could see light of the day.
2006 could see 125 to 150 issues with follow-on public offerings by listed companies continuing to dominate.
© 2025