Qualified Institutional Placements (QIPs) in India smashed records in 2024, with fundraising crossing ₹1.37 lakh crore by December. This surge reflects growing confidence in the domestic market, but the big question is—will this momentum carry into 2025?
What is a QIP, and why are companies racing to raise funds through it?
QIPs allow publicly listed companies to raise funds from institutional investors without going through complex regulatory filings required for public offerings. This fast-track route has become the go-to option for businesses looking to finance expansion, acquisitions, or reduce debt.
In 2024, India witnessed a remarkable surge in QIP activity. By December, 95 QIPs were completed, raising ₹1,37,560 crore. This marked a significant leap from the ₹54,350 crore raised through 45 issues in 2023, according to Prime Database.
Also read: What Are Domestic Institutional Investors (DIIs)?
| Year | QIPs Raised (₹ Cr) | No. of Issues |
| 2023 | 54,350 | 45 |
| 2024 | 1,37,560 | 95 |
Experts believe this trend is being driven by favourable market conditions, high liquidity, and increased investor confidence.
Major contributors to the QIP surge
Several high-profile companies led the charge in 2024.
| Company | QIP Amount (₹ Cr) |
| Vedanta Ltd | 8,500 |
| Zomato Ltd | 8,500 |
| Adani Energy Solutions | 8,373 |
| Varun Beverages | 7,500 |
| Godrej Properties | 6,000 |
| JSW Energy | 5,000.00 |
| Punjab National Bank | 5,000 |
The BFSI (Banking, Financial Services, and Insurance) sector, along with real estate, healthcare, and industrials, dominated QIP fundraising.
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Why are companies opting for QIPs?
- Flexible fundraising: QIPs allow companies to raise funds at market price, providing an efficient mechanism to secure capital without market disruptions.
- Debt reduction: Many companies are using QIPs to reduce debt and improve their balance sheets.
- Expansion and acquisitions: Firms like Vedanta and Godrej Properties are leveraging QIPs to fund strategic growth and acquisitions.
- Favourable market conditions: India’s bull market and strong investor sentiment have created an ideal environment for QIPs.
A booming stock market fueling QIPs
India’s robust equity market in 2024 set the stage for record QIP activity. Despite fluctuations, major indices like the Nifty 50 and Sensex ended the year with a modest 10% gain.
However, some caution remains.Foreign investors turned net sellers in the latter half of 2024, but domestic institutional investors stepped in to sustain the momentum.
IPOs and startup QIPs on the rise
Beyond traditional companies, new-age startups are also eyeing QIPs as a funding source. Zomato and Zaggle Prepaid Ocean Services secured significant amounts, while MapMyIndia raised ₹500 crore via QIP in 2023.
The startup IPO market also boomed, with companies like Ola Electric, Swiggy, and Ixigo going public.
India recorded ₹1.34 trillion in IPO fundraising in 2024, surpassing the previous record of ₹1.19 trillion in 2021. The trend is expected to continue into 2025, with 34 companies already securing approvals to raise ₹41,462 crore through IPOs.
“The growth of demat accounts to 179 million highlights increasing retail investor interest.”
Capex revival and economic growth
While QIP activity has been robust, private sector capital expenditure (capex) has lagged. The government has stepped in, accelerating infrastructure investments to stimulate growth.
India’s GDP grew by 5.4% in Q2 2024-25, its slowest pace in nearly two years. The finance ministry projects 6.5% growth for 2024-25, supported by rural consumption, government spending, and strong services exports.
However, analysts point out that sustained economic expansion will require increased private capex.
Will the QIP boom continue in 2025?
Looking ahead, the outlook for QIPs in 2025 remains optimistic but tempered by potential challenges. Higher US bond yields and global economic uncertainty could impact investor sentiment.
However, easing monetary policies and favourable domestic conditions could keep the momentum going.
For investors, keeping an eye on QIP trends can provide insights into sectors poised for growth and potential investment opportunities.
