India Inc have raised over Rs 11,000 crore this year via rights issue, signalling growing traction among domestic firms to mop up capital via this route, said the media report.
As per an analysis of capital raised through this route, a total of seven firms have raked in Rs 11,535 crore so far this year (January-July). Most of the funds were for expansion and to support working capital requirements.
This is much higher than about Rs 5,224 crore garnered via issuing 'rights' shares in the whole of 2014, added the media report.
According to analysts, fund raising through this route is likely to go up further as many firms have lined up plans for rights issue, where shares are issued to existing investors at a pre-determined price, normally at a discount, in proportion to their holdings.
The largest rights issue was from Tata Motors that raked in Rs 7,498 crore followed by Future Retail (Rs 1,589 crore),GMR Infrastructure (Rs 1,402 crore), State Bank of Travancore (Rs 474 crore), Can Fin Homes (Rs 276 crore), Zee Media Corp (Rs 195 crore) and Vascon Engineers (Rs 100 crore).
According to market analysts, a positive outlook for equities and availability of capital have opened this window for the companies to mop up fresh funds from issuing 'rights' shares.