MUMBAI: Government-owned Power Finance Corporation (PFC) raised $1 billion in overseas bond sales, which obtained record subscription for a non-banking finance company from India.
This is the largest such issuance after the ruling combine came back to power with a bigger majority.
The bond sale received demand for about $5 billion against which the company retained only the targeted sum. PFC had to increase the actual size of the bond sale due to the huge oversubscription. The company would use the money to lend in the power sector.
The bonds mature in five and ten years. They were priced after adding 195 basis points and 242.5 bps over and above US Treasury yields for similar maturities. A basis point is a hundredth of a percentage point. Rates were 25-28 basis points lower than the initial guidance.
US Treasuries currently yield 1.92% and 2.15% for the respective maturities.
MUFG, Barclays and Standard Chartered Bank helped the company raise the money.
“Quality and size of the order book underscored strong international interest,” said Shashank Joshi, head of global corporate banking for India, MUFG Bank. “This reflects (investor) confidence in PFC credit and the governments reform agenda for the power sector in India. It is the largest issue by far by an Indian non-banking finance institution.”
About three months ago, the state-owned power financier completed thRead More – Source