After the Lok Sabha elections, the corporate world is trying to raise capital through QIP

New Delhi: After the Lok Sabha elections, the corporate world is busy accelerating its plans to raise new capital. These companies are giving preference to Qualified Institutional Placement (QIP) to raise equity funds. Under this, the company issues new shares to investors at a price around the current market price.

The main reason behind the plans to issue new securities by listed companies is the election results and optimism about capital expenditure and better valuations. Recently, the board of directors of Adani Enterprises of the Adani Group has given permission to raise Rs. 16,600 crore through equity. Adani Energy Solutions also invested Rs. 12,500 crore and announced plans to raise Rs. 12,500 crore. Apart from this, Torrent Pharma, KPI Green and Cello World have also invested Rs. 750 crore to Rs. 5,000 crore capital has been targeted to be raised.

JSW Energy, Coforge and Angel One have successfully executed large QIPs in the past one month. Most of these companies will use the fresh capital to expand their operations and start new businesses.

QIPs are usually carried out at times when the market is bullish as it enables companies to raise capital at higher valuations. QIPs are less time consuming and cost less too, making it a preferred means of raising fresh capital.