Mumbai – India’s Power Finance Corp
(PFC) is set to launch the country’s largest retail
issue of bonds in nearly 8 years this week, as it targets to
raise up to 50 billion rupees ($554.23 million), according to a
term-sheet seen by Reuters.
The issue has a base size of 5 billion rupees and a
greenshoe option of 45 billion rupees. If the company can raise
the full quantum, it would be the largest public bond issue
since May 2018, data from the market regulator, the Securities
and Exchange Board of India, showed.
PFC will sell bonds maturing in 5 years, 10 years, 10 years
and 1 month, and 15 years. The issue will open for subscription
on Friday and close on January 30.
The company will offer an annual coupon of 6.85% to
institutional investors and corporates for five-year bonds, and
7.00% and 7.05% for 10-year and 15-year tenors, respectively.
For high-net-worth individuals, the state-run firm would pay
an additional 5 basis points, 10 bps, and 15 bps, and retail
investors an annual coupon of 7.00%, 7.20%, and 7.30% for the
five-year, 10-year, and 15-year paper, respectively.
PFC has also introduced a zero-coupon option for investors
with a 10-year and 1-month maturity, offering a yield of 6.80%
to institutional players and companies, 6.85% to HNIs, and 6.95%
to retailers.
The fifth option offered by PFC is also a 15-year paper,
with the option to make a direct payment at maturity. The yield
for this note is 7.05% for the first two categories, and 7.20%
and 7.30% for HNIs and retail investors, respectively.
This is PFC’s first public bond issue in 30 months, and the
notes are rated AAA by CRISIL, CARE, and ICRA.
AK Capital Services, Tip Sons Consultancy Services, Nuvama
Wealth Management, and Trust Investment Advisors are the lead
managers.
($1 = 90.2150 Indian rupees)
(Reporting by Khushi Malhotra and Dharamraj Dhutia; Editing by
Rashmi Aich)