FY23 saw a record-breaking fund mobilization of Rs 9.58 lakh crore through corporate bonds on a private placement basis, marking a substantial 26 percent YoY increase, as per primedatabase.com.
The funds were raised by 920 institutions and corporates, encompassing both listed and unlisted deals with a tenor and put/call option exceeding 365 days.
Strong economic growth and constrained liquidity in the banking system have driven a surge in credit demand, says Pranav Haldea, Managing Director of PRIME Database Group.
HDFC led the year's highest debt private placements with Rs 74,062 crore, followed by NABARD (Rs 63,164 crore), PFC (Rs 52,575 crore), REC (Rs 51,354), and SBI (Rs 51,080 crore). The top 5 issuers in 2023 raised Rs 2,92,235 crore (31 percent of the total), compared to Rs 1,96,276 crore (26 percent of the total) by the top 5 issuers in 2022. The majority of funds were raised in the above 10-year maturity bucket (Rs 3.46 lakh crore or 36 percent of the total), followed by the 3-5 years bucket (Rs 2.67 lakh crore or 28 percent of the total).
During the year, all-India financial Institutions/Banks topped the mobilization charts at Rs 4.72 lakh crore, marking a 29 percent increase from Rs 3.66 lakh crore in 2022. The private sector (excluding banks/FIs) also experienced a significant 40 percent surge, reaching Rs 4.45 lakh crore compared to Rs 3.18 lakh crore in 2022.
Government entities collectively raised 41 percent of the total amount, surpassing the 38 percent recorded in 2022. According to primedatabase.com, All-India Financial Institutions/Banks dominated government entities with an 89 percent share, followed by PSUs with a 9 percent share.
In 2023, 59 percent (Rs 5.61 lakh crore) of the total amount raised fell within the 7-8 percent coupon range, while 16 percent (Rs1.55 lakh crore) was in the 8-9 percent range. AAA-rated issues accounted for Rs 6.59 lakh crore (69 percent of the total).
The Banking/Financial Services sector continued to lead, raising Rs7.08 lakh crore (74 percent of the total), with the Housing/Civil Construction/Real Estate sector at a distant second with a 6 percent share (Rs 55,379 crore), according to data.
There were 404 first-time issuers, slightly lower than the 408 in the previous year. The public bonds market witnessed a nearly 175 percent increase, with 44 issues raising Rs 18,176 crore, led by the largest issue from Power Finance Corp. at Rs 2,824 crore. Additionally, Indian companies raised Rs 3.29 lakh crores through overseas borrowing, marking a 4 percent increase from Rs 3.18 lakh crores in 2022, the data showed.
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