Power Finance Corporation (PFC) is looking to raise R2,700 crore through five-year bonds at a coupon rate of 8.53%, according to bond market players. “PFC’s bond issue had received a considerable demand worth R4,000 crore. The pay-in date for the issue is on Friday,” a bond arranger indicated. Earlier, the state-owned company had issued five-year bonds at 8.42% in March this year.
Last week, PFC issued 10-year tax-free bonds worth R300 crore at a coupon rate of 7.16%. The company was looking to issue bonds having tenures of 10 years, 15 years and 20 years. Market participants had indicated the demand was so high that the company decided to raise the entire quantum through 10-year bonds.
PNB Housing Finance will also issue five-year bonds at a coupon rate of 8.56% to be paid semi-annually, sources indicated.
Market experts also believe Steel Authority of India (SAIL) and Nuclear Power Corporation of India (NPCIL) are likely to approach the bond market soon. NPCIL may seek bids from arrangers next week, a source said.
As far as tax-free bond issuances are concerned, Indian Railway Finance Corporation (IRFC) is likely to come out with its issue worth R1,800 crore soon, sources said. IRFC has received a total limit of R6,000 crore on the tax-free bonds.
So far, PFC and Rural Electrification Corporation (REC) have come out with their tax-free bonds through the private placement route. Public issue of tax-free bonds is likely to begin in August, according to bond arrangers.
National Highways Authority of India (NHAI), Housing and Urban Development Corporation (Hudco), Indian Renewable Energy Development Agency (IREDA) and NTPC are some other companies that have been permitted to issue tax-free bonds this fiscal.