Bank of Baroda to float Rs 5,000-crore, 10-year infra bonds

Bank of Baroda

State-run Bank of Baroda will on January 24 issue infrastructure bonds worth Rs 5,000 crore maturing in 10 years, according to people familiar with the development.

The bonds have a base issue of Rs 1,000 crore, with retain oversubscription of Rs 4,000 crore as greenshoe option. It is a provision in an underwriting agreement that grants the underwriter the right to sell investors more bonds than initially planned by the issuer if the demand for a security issue proves higher than expected.

Bidding for these bonds will take place between 11am and 12pm on January 24 on the bidding platform of the National Stock Exchange of India (NSE).

The pay-in date of the bond is January 25. It is the date when exchange of bonds and money takes place between issuers and investors.

The bonds have been rated ‘AAA’ with a ‘stable’ outlook by CRISIL and India ratings.

The minimum application size of this bonds is Rs 1 lakh and in multiples of Rs 1 lakh.

On January 19, Bajaj Finance and ONGC Petro Additions raised Rs 857.60 crore and Rs 900 crore through bonds.

Bajaj Finance issued bonds worth Rs 857.60 crore through five-year bonds at an 8.10 percent coupon and ONGC Petro Additions raised Rs 900 crore through three-year bonds at 8.29 percent.

The yield on the corporate bonds maturing in three-year were in the range of 7.75-7.80 percent, on five-year bonds at 7.65-7.75 percent, and on 10-year bonds at 7.65-7.70 percent.