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Indian Companies raised USD 17.13 billion
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Indian corporations dominated Asia-Pac FCCB offerings
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Foreign debt cheaper than local funds
Indian companies topped all expectations to raise USD 17.13 billion last
year in debt and capital market issues including USD 5.21 billion through
foreign currency convertible bonds (FCCB). The fund raising last year was about
USD 13 billion and this year the Reserve Bank of India (RBI) expected companies
to raise USD 15 billion. Seeing the trend, the RBI has increased the limit to
USD 18 billion for next year.
In the first four months of this year, Indian corporations dominated FCCB
issues in the Asia-Pac region, minus Japan, with 68% of offerings. Bankers say
that they expect companies to raised USD 4 billion in the next few months.
However, with the unprecedented crash of the Indian stock markets, companies
may rework their plans.
Companies find borrowing from abroad cheaper by 75-100 basis points than
borrowing locally.
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