India Equity House
Kotak Investment Banking won the lion’s share of the major equity offerings in a blockbuster year for the Indian capital markets.
It leveraged its relationships with both issuers and investors to work on the landmark IPOs and follow-on offerings during the review period, often edging out far bigger global rivals.
Kotak used its enviable distribution network to deliver for its clients in 2017, bolstering its reputation as the must-have bank on any big Indian equity transaction.
In a year when India’s insurance sector went public, Kotak managed three of the four US$1bn floats, working with SBI Life Insurance, General Insurance Corporation of India and New India Assurance.
It was the sole global coordinator for the Avenue Supermarts IPO, one of the best performing IPOs of 2017. It also managed the IPO of Godrej Agrovet, a rare equity offering from the Godrej Group and the biggest Indian IPO from the agriculture sector. Other notable Kotak IPOs included Indian Energy Exchange, India’s first listed power exchange, as well as Laurus Labs, Security and Intelligence Services and Mahindra Logistics.
In many of these IPOs, Kotak was instrumental in bringing in marquee international anchor investors, using its global marketing network and strong track record, having worked with these investors on other equity deals.
Not all transactions were done in an easy atmosphere. The Laurus Labs IPO launched just after demonetisation last November amid concerns that high-net-worth investors and retail buyers would shy away from the deal. However, the issue sailed through with the support of anchor investors and has done well since listing.
There was a resurgence in qualified institutional placements, particularly from companies in the financial sector, and Kotak worked on 70% of the deals by equity raised. As with the IPOs, Kotak helped attract global institutions as anchor investors.
It was one of the banks on parent Kotak Bank’s Rs58bn qualified institutional placement in May, a deal that paved the way for larger transactions during the year.
Kotak was also involved in State Bank of India’s Rs150bn QIP, the largest ever from the country, and helped procure a large portion of overall demand.
Bajaj Finance’s Rs45bn QIP was the largest from a non-banking finance company and was Kotak’s fourth back-to-back share sale in the financial sector during the review period.
Kotak was also instrumental on share placements from the corporate sector. It helped manage Apollo Tyre’s Rs15bn QIP, the largest from an Indian tyre company, attracting global investors such as T Rowe Price and Blackrock.
The Rs50bn Piramal issue was India’s first ever QIP involving compulsorily convertible debentures, and was tailored to suit both issuer and investors within India’s regulatory restrictions.
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