Indian companies garnered Rs 6.7 lakh crore from the issuance of corporate bonds in the last fiscal, with private placement emerging as the most preferred route, the Economic Survey said today.
The survey said that resource mobilisation through issuance of corporate bonds (public issuance and private placement) rose rapidly in 2016-17 as compared to preceding year.
According to the first ever mid-year economic survey, a total amount of Rs 6.70 lakh crore raised through 16 public issuance and 3,377 private placements.
Private placements continue to dominate the corporate bond market. However, it must be noted that resource mobilised through public and private placement of corporate bonds is not a substitute for bank credit, the survey said.
"The maturity period of bonds are much shorter compared to bank credit and hence one need to be cautious while comparing such resource mobilisation with bank credit," it added.
In the primary market, 134 companies accessed capital market and raised Rs 62,079 crore last fiscal compared to Rs 57,866 crore raked in through 107 issues in 2015-16, showing a gain of 7.3 per cent.
Besides, stock markets recorded a robust growth in 2016- 17, with Sensex rising by 16.9 per cent and Nifty gaining 18.6 per cent as compared to losses registered in 2015-16.
The steady upward momentum in the market was fuelled by global and domestic liquidity conditions. Also, foreign portfolio investors (FPIs) and domestic institutional investors have poured robust amount in the markets.
"The other factors which raised market sentiments during the year included government's commitment to fiscal consolidation roadmap, continuity and certainty of reforms, commitment to resolve bank NPAs (non-performing assets), and certainty on implementation of GST (Goods and Services Tax)," the survey noted.