KSK Emerging India Energy Fund (KEF) raised $200 million in June on London’s Alternative Investment Market (AIM). It was the fourth India-focused company to raise funds on AIM in as many weeks. The equity offering came at a time when the Bombay Stock Exchange’s Sensex 30 index was down more than 25% for the year to date on investor worries about inflation, rising interest rates and high oil prices. India imports about 70% of its oil.
With their home market in a slump, Indian growth companies with a need for funds are tapping the AIM division of the London Stock Exchange, which allows smaller companies to float shares under a quicker and easier system than applies to the LSE’s Main Market.
Indus Gas, OPG Power Ventures and Mortice, a security and facilities-management company, were among the recent companies from India to raise funds and list on AIM.
There are now 52 companies from India listed on the LSE, with a combined market capitalization of about $16.8 billion. Trading in the secondary market remains strong, according to the exchange, with more than $5 billion worth of trading in Indian securities in the form of global depositary receipts on the International Order Book in the first five months of 2008.