NTPC is likely to hit the dollar bond market soon to raise close to $400 million, sources aware of the matter confirmed to FE. “NTPC might hit the market in the next two weeks. The bonds will be issued under the Reg S format,” said a banker aware of the matter. Although the company had requested bids from investment bankers for 10-year and 30-year paper, the company is likely to go ahead with 10-year bonds, sources indicated. A banker even pointed out that the company has already held meetings with Asian investors late last year and the pricing of the forthcoming bond issue may happen without any roadshows. NTPC could not be immediately contacted to confirm the story. An email sent to the company remained unanswered till the time of going to press.

Earlier, the company had issued 10-year dollar bonds in February 2016 at a spread of 255 basis points over the 10-year US Treasury yield. “NTPC’s dollar bonds are trading at a spread of about 135 basis points in the secondary market. The company should be able to price its forthcoming issue at a spread of 140-145 basis points over the treasury yield. NTPC’s bonds always attract a significant demand from overseas investors,” said a banker. Post the sovereign rating upgrade last year, Moody’s had upgraded NTPC’s issuer rating to Baa2 from Baa3 and had revised its outlook to stable from positive. “Moody’s has also upgraded the rating on the senior unsecured MTN programme of NTPC to (P)Baa2 from (P)Baa3,” the ratings agency had indicated. In 2017, the company had issued 10-year Euro-denominated bonds to raise 500 million euro.

Foreign currency bond issuances from India have gathered steam over the past two weeks with ABJA Investment Co (a Tata Steel subsidiary), Exim Bank India and Yes Bank pricing their dollar bonds to raise a total of $2.9 billion. The overseas bond market might see several issuances from Indian banks in 2018 as more than $6 billion of foreign currency bank bonds come up for maturity during the year, and these will likely be refinanced through fresh issuances, according to bankers.

Bloomberg data shows that of the total bonds coming up for redemption in the year, those worth about $5.35 billion are all large sized issues by banks. Of these, bonds issued by ICICI Bank, Indian Overseas Bank, HDFC Bank and IDBI Bank worth $2.5 billion will mature in the first quarter of the calendar.