HDFC & NHAI may Raise ₹ 10k cr in Masala Bonds

The Economic Times - - Companies: Pursuit Of Profit -

Mum­bai: Hous­ing De­vel­op­ment Fi­nance Cor­po­ra­tion (HDFC) and Na­tional High­way Author­ity of In­dia (NHAI) are set to raise funds from the in­ter­na­tional mar­kets as US Fed­eral Re­serve is widely ex­pected to raise in­ter­est rates at least three times this year. To­gether, they could raise up to ₹ 10,000 crore by sell­ing ru­peedom­i­nated masala bonds (`5,000 crore each) to in­vestors be­fore the end of this fis­cal year largely, said mul­ti­ple sources with di­rect knowl­edge of the mat­ter. An email sent to NHAI re­mained unan­swered till the time of go­ing to press.

“We have re­ceived in-prin­ci­ple ap­proval to raise an­other ₹ 5,000 crore via ru­pee-de­nom­i­nated bonds,” Keki Mistry, vice chair­man, HDFC, told ET.

“We will de­ploy the pro­ceeds in hous­ing loans as we see larger de­mand over time as a re­sult of the gov­ern­ment’s con­tin­ued fo­cus on hous­ing. We will look for a right time to en­ter the mar­ket and bor­row money un­der the pro- gramme,” he said.

“In­dia is an at­trac­tive in­vest­ment des­ti­na­tion and the con­fi­dence of for­eign in­vestors is re­flected in their con­tin­u­ing in­ter­est in in­vest­ing in eq­uity and debt of In­dian com­pa­nies,” he said. While NHAI has ap­pointed three bankers — Axis Bank, Stan­dard Char­tered Bank and No­mura, HDFC is in talks with bankers, sources said. In­di­vid­ual banks could not be con­tacted im­me­di­ately for com­ments. “Bankers would be aim­ing to raise the whole sum or most of it, be­fore the fi­nan­cial year ends as US rate in­creases look im­mi­nent, adding to bor­row­ing cost,” said a se­nior banker.

HDFC, In­dia’s largest mort­gage lender, was the first to tap the masala bond mar­ket last year col­lec­tively rais­ing ₹ 5,000 crore worth of masala bonds. These bonds, listed on the Lon­don Stock Ex­change, has three-year ma­tu­ri­ties and are priced a few ba­sis points lower than its do­mes­tic cor­po­rate bond rates.

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