NTPC raises $500 mn from overseas bonds issue

State-run NTPC today said it has raised USD 500 million (over Rs. 2,600 crore) through issue of bonds in international markets and the proceeds would be utilised for existing as well as new power projects.

The bond offering happened on September 24, just a few days after the government lowered withholding tax on external commercial borrowings.

“This is the third offering under the company’s USD 2 billion Medium Term Note MTN programme since it was set up in 2006, taking the cumulative amount raised under the programme to USD 1.3 billion,” NTPC said in a statement.

According to the company, the offering was met with extremely strong demand and the transaction was oversubscribed within one-and-a-half hours of book building.

NTPC Chairman and Managing Director Arup Roy Choudhury said the strong investor response to the bond offering reflects the company’s superior credit quality.

The speed of execution of the transaction demonstrates NTPC’s responsiveness to market opportunities, he noted.

“This is a landmark transaction for the company with several firsts to its credit — it is the first corporate offering from India in the current fiscal, first bond offering after government guidelines on lower withholding tax and has the lowest coupon on any bond offering by the company,” NTPC Director (Finance) A K Singhal said.

The proceeds would bee used to ongoing and new power projects.

“In terms of geographical distribution, Asia took the bulk of the transaction at 62 per cent, with supplemental demand from Europe and offshore US accounts at 31 per cent and 7 per cent, respectively,” the statement said.

Funds accounted for 57 per cent of the transaction, followed by private banks (18 per cent), banks (14 per cent), insurance/pension (8 per cent) and others (three per cent).

Barclays Capital, Citigroup, Deutsche Bank and The Royal Bank of Scotland were the bookrunners for the offering.

NTPC has an installed power generation capacity of 39,174 MW.

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Printable version | Jun 24, 2021 3:32:14 AM |

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