State-run telecom company Mahanagar Telephone Nigam Ltd (MTNL) plans to raise up to Rs 7,000 crore through government of India-guaranteed bonds maturing in 10 years or on November 15, 2032, merchant bankers familiar with the development said.
The total size of the issue consists of a Rs 500-crore base issue and Rs 6,500 crore in greenshoe, dealers said.
Bidding for the bonds will take place on November 14, between 10:30 am and 12:00 pm, on the BSE's electronic bidding platform. The pay in and allotment will take place on November 15.
The bidding will be held for coupon setting. "We expect coupon to be set between 8.05-8.25 percent on MTNL's 10-year bond," said one of the persons quoted above.
A government guaranteed bond is a debt security that offers a secondary guarantee that interest and principal payments will be made by a government if the company fails to repay the amount.
MTNL's bond has been rated 'AAA' by the India Ratings and ICRA. While, investors bidding for this bond have minimum application size of Rs 10 lakh and in multiples of Rs 10 lakh.
Last time MTNL had tapped market to raise funds was in October and December 2020. At that time, they raised Rs 4,361.40 crore via bonds maturing on October 11, 2030, and Rs 2,138.60 crore through bonds maturing on December 20, 2030, according the data compiled by Prime database.
MTNL had a coming maturity of a bond on March 28, 2023 for the amount of Rs 1,005 crore.
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