India Inc to raise over Rs9,000 crore through rights issue in FY-08

11 May 2007

Mumbai: India Inc is all set to raise over Rs9,000 crore this fiscal through rights issue of shares, a new study by Prime data base firm shows.

As many as 24 companies have lined up rights issues to raise Rs2,344 crore and at least another 50 companies have plans to mop up Rs7,700 crore, according to Prime.

Corporates are banking on a buoyant secondary market and an expected revision in SEBI guidelines, despite a 10 per cent dip in rights issues mobilisation in 2006-07, Prime said.

Available data show Tata Steel, which plans to raise about Rs3,655 crore, GTL Infrastructure (Rs1,000 crore), Zee Group''s Wire and Wireless India (WWIL) (Rs1,125 crore) and JSW Steel (Rs400 crore) would tap the rights issue route to raise funds, Prime said.

Others include Dagger Forst Tools (Rs29 crore), Federal-Mogul Goetze (Rs110 crore), Network 18 Fincap (Rs203 crore), Orient Paper & Industries (Rs175 crore), SAAG RR Infra (Rs40 crore), Trent (Rs158 crore) and VBC Ferro Alloys (Rs50 crore), Prime said.

"Scores of companies continue to prefer preferential allotments of equity to meet their fund requirement. Several companies have also tapped the overseas market through GDR/ADR /FCCB route (in fiscal 2006-07)," Prithvi Haldea, managing director of Prime said.