Bank of Baroda, National Bank for Agriculture and Rural Development (NABARD), and the Indian Renewable Energy Development Agency (IREDA) will float bonds aggregating to Rs 14,500 crore on December 20, market sources said.
As per the term sheet, Bank of Baroda have a base issue of Rs 1,000 crore, with retain oversubscription of Rs 1,500 crore. NABARD have Rs 5,000 crore each in base issue and greenshoe option.
IREDA’s bond issue consists Rs 500 crore in base issue and Rs 1,500 crore in greenshoe, sources said.
A greenshoe is the over-allotment option that allows companies to issue more bonds or raise more funds than the base issue size.
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The bonds of IREDA will mature in 10 years or on December 22, 2033, NABARD’s bonds will mature after 10 years 4 months and 7 days on April 28, 2034. Similarly, Bank of Baroda will issue Basel-III Tier-II bonds maturing in 10-year or on December 21, 2033.
IREDA and NABARD’s bonds were rated ‘AAA’ with ‘stable’ outlook by India Ratings and ICRA.
Market sources said that on December 21 that National Bank for Financing Infrastructure and Development (NaBFID) will also issue bonds worth Rs 10,000 crore. These bonds will mature in 15 years or on December 22, 2038.
Earlier this year, Rajkiran Rai G, Managing Director of NaBFID during an interview with Moneycontrol said that the bank is likely to tap the bond market in the third quarter of the current financial year. This is because by September they will be able to use recently raised money through bonds and also they have some credit lines with different banks, he added.
The bank has received approval to raise Rs 30,000 crore.
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“If the disbursement plans stick, then we have to achieve Rs 30,000 crore fundraising, but not in the second quarter, it may come in the third quarter. The second issuance may come in the third quarter of this financial year,” he said.
In June, NaBFID raised Rs 10,000 crore through the issuance of listed bonds maturing in 10 years at a 7.43 percent coupon.
The issue received bids worth Rs 23,629.50 crore from the investors, which is approximately 4.7 times of oversubscription against the base issue of Rs 5,000 crore.
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