The Future Group is understood to be exploring the possibility of a dollar bond issue through one of its entities for an amount close to $300 million, multiple sources confirmed to FE. “The company is likely to issue the bonds, possibly through an overseas subsidiary. It may raise close to $300 million through five-year dollar bonds,”said an investment banker aware of the deal.
An email sent to the company’s media relations team seeking clarifications on the same remained unanswered till the time of going to press. One of the group companies — Future Enterprises — develops, owns and leases the retail infrastructure for the group, according to the company’s website. It also holds the group’s investments in subsidiaries and joint ventures including insurance, textile manufacturing, supply chain and logistics.
Future Enterprises reported a standalone net loss of Rs 45.46 crore for the first quarter of fiscal year 2018. The company, in July, had incorporated an offshore wholly-owned subsidiary company called Future Merchandising and Sourcing Pte at Singapore.
Future Retail is the flagship company of the Future Group and focuses on the hypermarket, supermarket and home-solutions segment. It operates the Big Bazaar supermarket chain. The company had doubled its net profits for the first quarter of FY18 at Rs 148 crore, led by a surge in sales.
An Edelweiss research report points out that Big Bazaar’s same-store sales growth (SSSG) stood at 15.9% y-o-y (above 15% in the past four quarters), while the company level SSSG stood at 11.8% y-o-y. The overseas bond markets have been extremely conducive over the last few months. In 2017 so far, Indian companies and banks have raised over $11 billion through overseas bond issues.
The volumes have surged so much that the market is giving tough competition to the loan-syndication market, which has seen a decline this year. Bankers indicate that foreign investors are upbeat on Indian papers on the back of a stable currency and sound fundamentals of the country.