Reliance Industries Plans INR 12,500-Cr Bond Sale
Reliance Industries plans INR 12,500-crore bond sale at 7.47% coupon, its first offering since 2023, sources say.
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Mukesh Ambani’s Reliance Industries is planning to raise up to INR 12,500 crore (USD 1.3 billion) through local-currency bonds as early as next week, according to people familiar with the matter. The deal could become the largest listed bond issuance in the market this year.
The company plans to raise funds through AAA-rated notes due in five years, carrying a coupon of 7.47%, sources said. The rate is lower than the 7.87% average yield on top-rated five-year corporate bonds as of Monday.
This will be Reliance’s first bond offering since November 2023. It comes as companies have increasingly turned to bank loans over bonds for financing amid relatively lower borrowing rates, following a slow start to the debt market this year. The issuance is expected to boost activity in the local bond market.
Reliance joins other Indian companies weighing bond offerings amid expectations that the Reserve Bank of India may tighten monetary policy later this year as inflation risks rise.
The bond sale coincides with another major fundraising move by the group. Jio Platforms, Reliance’s telecom and digital arm, could raise up to USD 4 billion through an initial public offering as early as November, according to people familiar with the matter.
Indian companies have borrowed INR 8.9 lakh crore through domestic bonds so far this year, down about 11% from a year earlier, according to Bloomberg data. The yield on top-rated three-year company notes has risen 70 basis points over the past year, while the weighted average rate on fresh rupee loans sanctioned by banks fell 29 basis points in the 12 months through July, according to central bank data.
Axis Bank, ICICI Bank, HDFC Bank and YES Bank are arranging the issuance. The base offer size is INR 10,000 crore, with a greenshoe option to raise an additional INR 2,500 crore.
“Reliance’s rupee bond issue will set a benchmark for top-rated issuers. Fund houses will rush to grab a piece of debt,” said Ajay Manglunia, executive director, Capri Global Capital.
Mukesh Ambani’s Reliance Industries is planning to raise up to INR 12,500 crore (USD 1.3 billion) through local-currency bonds as early as next week, according to people familiar with the matter. The deal could become the largest listed bond issuance in the market this year.
The company plans to raise funds through AAA-rated notes due in five years, carrying a coupon of 7.47%, sources said. The rate is lower than the 7.87% average yield on top-rated five-year corporate bonds as of Monday.
This will be Reliance’s first bond offering since November 2023. It comes as companies have increasingly turned to bank loans over bonds for financing amid relatively lower borrowing rates, following a slow start to the debt market this year. The issuance is expected to boost activity in the local bond market.
Entrepreneur Staff • Editor
Entrepreneur Staff
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