Indian private debt placements up 11% in April-June quarter

Indian companies and institutions raised Rs 87,840 crore through private debt placements in the April-June quarter, an 11 percent increase from a year ago. Mobilisation through the issue of debt securities or bonds to institutional investors was Rs 78,960 crore a year earlier, according to data compiled by Prime Database.

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The amount was mopped up by 109 institutions and corporates during the quarter under review, the report said. The highest mobilisation through private debt placements was by HDFC (Rs 9,610 crore), followed by PFC (Rs 9,434 crore), LIC Housing (Rs 6,912 crore) and REC (Rs 6,800 crore).

Market experts said companies are flocking to the debt market because of a large differential in corporate bond yields and bank loan rates. Financial institutions and banks continued to dominate the Indian debt market, raising Rs 41,922 crore, up 10 percent from over Rs 38,000 crore mopped up in the quarter ended June 30, 2012.

Private companies saw the sharpest increase, garnering Rs 38,108 crore, up 32 per cent from more than Rs 28,939 crore raised a year earlier. Funds raised by public sector undertakings plunged 45 percent to Rs 5,626 crore. The amount garnered by state-level undertakings fell 17 percent to Rs 933 crore.