NTPC mops up $450 million through 5-year bonds

(Representative image)India’s largest generation utility NTPC has mopped up $450 million (Rs 3,105 crore at current exchange rate) through five-year bond offering in the international market as part of the state-run company’s plan to mobilise $6 billion (about Rs 41,400 crore) through medium-term notes (MTN).

The latest mop-up takes the cumulative amount raised under the MTN programme to $4.3 billion (about Rs 29,600 crore), indicating continued investor interest in the company due to its strong performance and financial underpinnings. The $6-billion MTN programme was launched in 2006.

A company statement said the latest offering’s order book reached $1 billion within the first hour of deal announcement and rose to $2 billion by noon. The order book attained a peak of $3 billion. The final order book was over $1.8 billion, an oversubscription of nearly four times, with orders from more

than 100 accounts. However, the company raised only $450 million.

The notes carry a coupon (rate) of 3.75% per annum payable semi-annually. The notes will mature on April 3, 2024 and all the principal and interest payments will be made in Greenback. The notes will be listed on the Singapore Exchange Securities Trading, India International Exchange (IFSC) and NSE IFSC. The company expects to list the notes in the first week of April after receiving the funds.

Fund managers took 69% of the subscription, followed by banks with 22%, insurance/pension 8% and private banks/wealth manager 1%, the company said. The proceeds of the issue are to be used to finance the company’s ongoing and new power and coal mining projects, acquisitions as well as renovation and modernisation of existing power stations. Axis Bank, Mizuho, MUFG, SMBC Nikko and Standard Chartered Bank were the joint lead managers and book runners for the offering.


Author: Ayaan