Indian companies have raised a record $31 billion in equity capital in 2020, Refinitiv data showed, as banks strengthen their balance sheets to prepare for future economic uncertainty and corporates tap into the elevated global liquidity levels.

The record raising comes despite India's economy contracting 23.9 per cent in the June-quarter, year on year, which puts it on track for the first annual contraction since 1980.

The rush of deals though has not been extended to initial public offerings (IPOs), which have fallen to a five-year low to be worth just $1.5 billion, in the eight months year to date, the data showed.

Banks have been the most active issuers, raising $13.68 billion, followed by the energy and power sector with $7.05 billion, and consumer products with $3.41 billion.

Reliance Industries's $7-billion raising in June was the country's largest, the data showed, as the company turned net debt-free and is now looking to expand its consumer business by acquiring Future Group's retail arm.

Real estate companies were identified by corporate advisors as the most likely candidates to tap the markets further in 2020 as property demand is expected to return after the disruption caused by the coronavirus crisis.

Surging cash levels – helped by $15 trillion of stimulus made available for economies to withstand the fallout of the pandemic was primarily responsible for the raising rush, advisors said.

Foreign appetite to buy Indian equities has risen sharply, with investors outside India buying $10.3 billion of new shares in the three months to August, the Refinitiv data showed.