Page 34 - The Indian EYE 093022

BUSINESS EYE SEPTEMBER 30, 2022 | The Indian Eye 34

A plunging rupee, falling stocks and

shaky IPOs show all is not well on

economy front

Initial Public Offer fund-raising declined by 32 per cent in the first half of the current

fiscal to Rs 35,456 crore by 14 main-board issues

OUR BUREAU
New Delhi/Mumbai
he Indian rupee weakened by 37 paise to hit
a new all-time closing low of 81.90 against
Tthe US dollar on Wednesday as the green-
back strengthened against major global currencies.
At the interbank foreign exchange market, the In-
dian rupee slipped below the 82-level for the first
time against the US dollar. The Indian rupee has
weakened sharply in recent days largely due to a
strengthening of the US dollar.
For the record, the US Federal Reserve had
raised the repo rate by 75 basis points -- which is
the third consecutive hike of the same magnitude,
in line with expectations, which essentially means
that investors will move towards the US markets
for better and stable returns amid the monetary
policy tightening. The Fed also hinted that more
rate hikes were coming and that these rates would
stay elevated until 2024.
There has also been weakness in the equities
markets. The Indian stock market’s key indices,
Sensex and Nifty, slumped for the sixth consecu-
tive session on Wednesday dragged by heavy sell-
ing pressure in the index heavyweights Reliance
Industries, ITC and HDFC Bank.
The benchmark indices on Indian equity mar-
kets closed flat on Thursday, due to the selling There has also been weakness in the equities markets for days including at the Bombay Stock Exchange (ANI)
pressure prevalent in global markets. The S&P
BSE ended 0.33 per cent lower at 56,409 level, 188
points down from the previous session while Nif- ing spree witnessed in the Indian rupee. from Rs 51,979 crore raised through 25 IPOs in
ty50 closed at 16,818, down 41 points. During the Meanwhile, it has been revealed that just 14 the corresponding period of FY22. Of the total, as
early trade, the indices snapped the six-day losing companies raised Rs 35,456 crore through main- much as Rs 20,557 crore or 58 per cent was raised
streak and opened higher on Thursday, however, board primary share sales in the first half of the just from the LIC issue, Pranav Haldea, the man-
the indices took a U-turn and reversed gains. fiscal, down 32 per cent from the year-ago period aging director of Prime Database Group, said in a
RBI is expected to hike its policy rate by 50 when 25 issues had mopped up Rs 51,979 crore. note on Thursday.
basis points for the third time in a row as the ru- But according to Prime Database, the IPO The overall public equity fundraising also
pee’s plunge to a record low complicates the battle pipeline is strong with 71 issues worth Rs 1,05,000 dropped by 55 per cent to Rs 41,919 crore from Rs
against inflation. crore having Sebi approvals and another 43 worth 92,191 crore during the period, he added.
The Bank of England’s decision to buy about Rs 70,000 crore are awaiting approval. Of While the LIC issue was the largest ever in
long-dated British bonds prompted a pullback in these 114 planned issues, 10 are new-age tech the country at Rs 20,557 crore, this was followed
Treasury yields and the dollar index. The local cur- companies, which are looking to raise roughly Rs by Delhivery (Rs 5,235 crore) and Rainbow Chil-
rency closed at 81.94 versus dollar on Wednesday. 35,000 crore. dren’s (Rs 1,581 crore). Only one of the 14 IPOs
Sugandha Sachdeva, vice-president for com- The overall collection would have been much (Delhivery) was from a new-age technology com-
modity and currency research, Religare Broking, lower had it not been for the Rs 20,557-crore LIC pany, clearly indicating the slowdown of issues
said most of the Asian currencies, including the issue, which constitutes as much as 58 per cent of from this sector after the disastrous issues from
local unit, are reeling under pressure amid the the total amount raised during the first half of the Paytm and a few others.
monetary tightening campaign in the West and year, as per Prime Database. Meanwhile, SME issues saw a huge increase
concerns about a global economic slowdown. Lim- IPO (initial public offer) fund-raising declined in the first half with 62 issues collecting a total of
ited intervention by the RBI amid declining forex by 32 per cent in the first half of the current fiscal Rs 1,078 crore, up from 30 issues collecting Rs 346
reserves is also leading to the current bout of sell- to Rs 35,456 crore by 14 main-board issues, down crore in the year-ago period.

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