Did the stock markets come to the rescue of India’s economy during 2021-22? The Survey says that capital markets ihave been more important than banks for the economy’s revival in the current fiscal. It rpointed out that the current financial year proved to be exceptional for the primary markets with a boom in fundraising through IPOs by many new age companies/tech start-ups/unicorns as ₹89,066 crore was raised via 75 IPOs, much higher than in any year in the last decade. It pointed out that credit growth has been declining since 2019. The credit growth was 5.3 per cent at the beginning of April 2021 and started to increase since then, but was still modest and stood at 7.3 per cent as on December 17, 2021, according to data. “However, credit growth haicked up sharply in o 9.2 per cent as on December 31, 2021. In 2021-22, the risk capital (that is money raised from capital markets) has so far been more important than the banks in providing finance to the revival. Overall, debt mobilidation slowed, and this contrast with the equity market suggests an increased appetite for risk among investors,” the Survey said. On the debt side, funds raised through corporate bonds was around ₹3.7 lakh crore in April- November 2021. The amount raised through public issues in debt doubled as 20 public issues raised ₹9,132 crore during April-November 2021, as compared to 10 issues which raised ₹3,871 crore during the corresponding period of previous year. However, number of issues and amount mobilised through private placement declined as ₹3.6 lakh crore was raised through 851 issues during April-November 2021, as compared to ₹4.9 lakh crore mobilised through 1,299 issues during April-November 2020. “Overall, debt mobilisation slowed, and this contrast with the equity market suggests an increased appetite for risk among investors,” the Survey said.
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