Fund mobilisation through equity, debt routes down 20% to ₹11 lakh crore in 2022

"The first half of 2023 could continue to be challenging, largely driven by global macro developments," said Vishal Chandiramani, Managing Partner Products and COO, TrustPlutus Wealth (India) Private Limited.

Fund mobilisation by companies through equity and debt routes has dropped 20% in 2022 to nearly ₹11 lakh crore, as exuberance dwindled this year due to expensive credit avenues and volatile markets. The first half of 2023 could continue to remain challenging.

The year 2021 was extraordinary for fundraising from the equity and debt routes, while 2022 has seen a slowdown in capital raising owing to elevated volatility provoked by unprecedented inflation globally and the Russia-Ukraine war.

"The first half of 2023 could continue to be challenging, largely driven by global macro developments. If the slowdown/recession in the U.S. is mild, then we could see a rally in global markets in the second half of next year, which would aid investor sentiment and the Indian markets as well," said Vishal Chandiramani, Managing Partner Products and COO, TrustPlutus Wealth (India) Private Limited.

“Even with a bounce back in markets, it will be more difficult to garner funds over the next few years as compared to earlier,” he noted.

In the year passing by, mobilisation from debt markets has inched up, while fresh capital mop-up through equity instruments has sharply fallen as volatile stock markets triggered by geopolitical tensions resulted in IPO fundraising halving in 2022.

Debt market mobilisation continued to contribute a lion's share to the overall fundraising activity this year.

Out of the cumulative ₹11 lakh crore garnered till mid-December this year, funds totalling ₹6.92 lakh crore were mopped up from the debt market, ₹1.62 crore came from the equity market and ₹2.52 lakh crore via the overseas route, data compiled by analytics major Prime Database showed.