India Inc Turns to Equity, Bonds as Bank Loans Remain Elusive

Indian corporates are increasingly shifting away from bank funding towards alternative sources such as equity and bond markets, as their deleveraged balance sheets have improved their ability to raise equity at better valuations.

- SUBRATA PANDA

Moreover, the 100 basis points (bps) rate cut by the Reserve Bank of India (RBI) has enabled them to access long-term funds from the debt capital market at cheaper rates.

Fund-raising by corporates has been abuzz this year through block deals and qualified institutional placements (QIPs). In FY25, India Inc has raised over ₹42,000 crore through QIPs. Additionally, they have raised over ₹1.07 trillion through block deals during this period. At the same time, India Inc raised over ₹4 trillion through bonds in the April-July period of FY26—the highest ever for the first four months of a financial year—underscoring the corporate bond market's rising preference over traditional bank loans, driven by favourable interest rate conditions.

In the same period last year (Q1FY25), Indian companies raised ₹2.11 trillion from the domestic debt capital market through bonds.