The Indian economy is estimated to have grown by 7.4 per cent in 2009-10. According to the latest Central Statistical Organisation (CSO) data, financial services, banking, insurance and real estate sectors rose by 9.7 per cent in 2009-10. As per the Securities and Exchange Board of India (SEBI), number of registered Foreign Institutional Investors (FIIs) as on May 31, 2010 was 1710 and the cumulative investments in equity since November 1992 to May 31, 2010, was US$ 77.2 billion , while the cumulative investments in debt during the same period were US$ 13.4 billion.

The total FII inflow in equity during January to May 2010 was US$ 4.6 billion while it was US$ 5.9 billion in debt. Net investment made by FIIs in equity between June 1, 2010 and June 14, 2010 was US$ 530.05 million while it was US$ 875.73 million in debt, as per the latest data released by SEBI. The average assets under management of the mutual fund industry stood at US$ 170.46 billion for the month of May 2010, as compared to US$ 135.58 billion in May 2009, according to the data released by Association of Mutual Funds in India (AMFI). As on June 4, 2010, India's foreign exchange reserves totalled US$ 271. billion, an increase of US$ 9.87 billion over the same period last year, according to the Reserve Bank of India's Weekly Statistical Supplement. Private equity (PE) firms invested about US$ 2 billion across 56 deals during the quarter ended March 2010, according to a study by Venture Intelligence, a research service focussed on PE and merger and acquisitions (M&A) transaction activity in India. The amount invested during the January-March 2010 quarter was the highest in the last six quarters.

The figure was significantly higher than that during the same period last year (January-March 2009) which witnessed US$ 620 million being invested across 58 deals and also the immediate previous quarter (October-December 2009) where investments worth US$ 1,681 million were made across 102 deals. Also, a study by Project Finance International (PFI), a source of global project finance intelligence and a Thomson Reuters publication has ranked India on top in the global project finance (PF) market in 2009, ahead of Australia, Spain and the US.

The study said the main market for PF in 2009 was the domestic Indian market, which raised US$ 30 billion, accounting for 21.5 per cent of the global PF market. This was up from US$ 19 billion in 2008

Qualified Institutional Placements (QIPs)

QIP is a capital raising tool, whereby a listed company can issue equity shares, fully and partly convertible debentures, or securities other than warrants, which are convertible into equity shares, to a qualified institutional buyer (QIB). In 2009, Indian companies had raised close to US$ 7.13 billion by way of 45 QIP issuances.

Stock markets

According to data from Bloomberg, India's market cap as a percentage of world market cap was 2.8 per cent as on December 31, 2009. In 2009, there were 21 IPOs that raised US$ 4.18 billion as compared to 36 IPOs in 2008 that raised US$ 3.62 billion.Further, according to ICICI Securities, Indian companies are likely to raise up to US$ 42.43 billion from the primary market over the next three years. According to Madhabi Puri-Buch, Managing Director and CEO, ICICI Securities' nearly US$ 20 billion will be raised from the initial public offer (IPO) market this fiscal (2010-11), of which around US$ 8.49 billion would be from the public sector and an equal amount from private companies.

Moreover, on the back of an increase in the participation of agriculture and othercommodities, the 23 commodity exchanges posted 50 per cent year-on-year growth in turnover in the April-February period of 2009-10, to touch US$ 1.53 trillion, according to the commodity markets regulator, Forward Markets Commission (FMC).

Insurance

India is the fifth largest life insurance market in the emerging insurance economies globally and the segment is growing at a healthy 32-34 per cent annually, according to the Life Insurance Council. According to the Insurance Regulatory and Development Authority (IRDA), total first year premium collected in 2009-10 was US$ 24.64 billion, an increase of 25.46 per cent over US$ 19.64 billion collected in 2008-09. Further, according to IRDA, in April 2010, life insurance companies collected first year premium worth US$ 1.29 billion, as compared to US$ 810.9 million in the corresponding period of 2009.

The life insurance industry is expected to cross the Rs 3 lakh crore total premium income mark in 2010-11. “This year, we are expecting a growth of 18 per cent in total premium income. If achieved, it is expected to cross the US$ 64.4 billion mark,” said SB Mathur, secretary general, Life Insurance Council. Total premium income, at US$ 56.04 billion, rose 18 per cent during 2009-10, against US$ 47.6 billion in the previous year.

Banking services

According to the weekly statistical supplement (WSS) of the Reserve Bank of India (RBI), Indian bank loans represented a rise of 19.1 per cent as of June 4, 2010 while deposits were up 14.3 per cent from the previous year. Furthermore, outstanding loans showed an increase from US$ 12.39 billion to US$ 703.5 billion in the two weeks to June 4, 2010. The WSS reflected that bank deposits rose by US$ 3.24 billion to US$ 975 billion in the two weeks to June 4.

Research By www.ibef.org