Latest news with #VenkatakrishnanSrinivasan
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Business Standard
2 days ago
- Business
- Business Standard
LIC picks up Adani Ports and Special Economic Zone's entire Rs 5K cr issue
State-owned Life Insurance Corporation (LIC) on Thursday entirely subscribed to the ₹5,000 crore bond issue of Adani Ports and Special Economic Zone (APSEZ) at a coupon rate of 7.75 per cent, said sources privy to the development. APSEZ tapped the domestic capital market on Thursday to raise ₹5,000 crore through 15-year bonds. This was its largest-ever rupee-denominated bond issue and also its first 15-year bond sale. 'There was only one bid from LIC and it was a pre-approved, privately negotiated transaction. No other bids were received, and since it wasn't a market-based issuance, there was no green shoe option either,' said a source aware of the development, adding that it's possible that the company was concerned about having to offer a higher coupon rate had it come to the broader market. 'And the tenure was quite long, which typically doesn't attract banks. Perhaps other insurance firms or provident funds could have participated, but Adani approached only LIC for this transaction,' the person added. The proceeds of the bond issuance will be used by the company to refinance/ repayment/ prepayment of its existing debt obligation. Additionally, it will be used for capital expenditure towards the development of the port and its related infrastructure. 'Adani Ports, India's largest private port operator, has raised ₹5,000 crore through a 15-year domestic bond issuance at 7.75 per cent-- marking its longest-tenor and largest rupee debt deal to date. Such extended tenors are rare for private issuers in India's bond market, where issuances typically cap at 10 years. The coupon, priced approximately 126 bps above comparable government securities, reflects strong and increasing investor appetite amid favourable market conditions,' said Venkatakrishnan Srinivasan, founder and managing partner of Rockfort Fincap LLP. APSEZ operates a portfolio of 15 domestic ports/terminals with international presence at four global ports/terminals. Along with its port operations, it has its wide logistics network and offers various port based marine services to its owned ports/terminals as well as other ports. According to a recent rating note by domestic rating agency Crisil, APSEZ's bank loan facilities and non-convertible debentures have been rated 'AAA' while its commercial papers have been rated A1+. Additionally, recently global rating agency Fitch Ratings has affirmed APSEZ's long-term foreign-currency issuer default rating at 'BBB-' and removed it from rating watch negative. Emails sent to Adani Group and LIC did not elicit a response. In January 2024, APSEZ tapped the domestic debt capital market to raise ₹250 crore through 10-year papers at 8.80 per cent. In January 2024, yields on 10-year government securities was hovering around 7.2 per cent. LIC is one of the largest institutional investors in the domestic debt capital market. In FY25 alone, it invested ₹ 80,000 crore in bond issuances of Indian companies, up 30 per cent from last year. Meanwhile, apart from APSEZ, other Indian corporates who tapped the market on Thursday had a tough time raising the entire quantum they had intended to raise. Marquee companies, including Bajaj Finance, Tata Capital, National Bank for Financing Infrastructure and Development, and APSEZ were among the companies who cumulatively were eyeing over ₹13,000 crore National Bank for Financing Infrastructure and Development, which was in the market to raise ₹5,000 crore (base issue ₹2,000 and ₹3,000 crore green shoe), retained only ₹2,100 crore at 6.67 per cent through 5-year papers.
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Business Standard
14-05-2025
- Business
- Business Standard
Jio Credit raises Rs 1,000 crore in maiden bond issue at 7.19% yield
Jio Credit, a wholly-owned subsidiary of Jio Financial Services, has raised Rs 1,000 crore through maiden bond issuance, selling bonds maturing in 2 years and 10 months at a cutoff yield of 7.19 per cent, sources said. The issue included a base size of Rs 500 crore and a greenshoe option of Rs 500 crore. The issue received bids worth Rs 1,500 crore, three times the base issue, according to sources. The offering attracted strong interest primarily from mutual funds, given its shorter tenor, though there was some participation from insurance companies as well, sources further said. Additionally, sources indicated that the cutoff yield was 7–8 basis points lower than that of some leading private sector non-banking financial companies (NBFCs) operating in the same segment. ICICI Securities Primary Dealership was the sole arranger for the issue, sources said. 'Due to the escalation in tensions between India and Pakistan, yields on government securities had risen, leading to a corresponding spike in corporate bond yields. However, following the ceasefire announcement, G-Sec yields have rallied, while corporate bond yields have not seen a comparable recovery. In this context, Jio Credit managed to secure a tight cutoff despite it being a maiden issue—largely attributed to the strength of the brand. Typically, maiden issues carry a cut-off 5–10 basis points higher than regular issuances,' said Venkatakrishnan Srinivasan, founder and managing partner of Rockfort Fincap LLP. In March, Jio Credit, which was earlier known as Jio Finance, was considering entering the domestic capital market to raise up to Rs 3,000 crore. However, the firm delayed the issuance as yields on corporate bonds were trending higher, and there was expectation of yields softening in the coming months. The company, in March, completed its maiden commercial paper issuance, raising Rs 1,000 crore at a yield of 7.80 per cent by selling commercial papers with a tenure of three months. Jio Financial Services is a core investment company registered with the RBI. It operates its financial services business through consumer-facing entities, including Jio Credit, Jio Insurance Broking, Jio Payment Solutions, Jio Leasing Services, Jio Finance Platform and Service, and Jio Payments Bank. Jio Credit has an asset under management (AUM) of Rs 10,000 crore as of March 2025. It offers home loans, loan against property, loan against mutual funds, and loan against shares. Additionally, it is also into vendor financing, working capital loans, and term loans among other things.
Business Recorder
09-05-2025
- Business
- Business Recorder
Indian bond yields set to rise amid widening conflict with Pakistan
MUMBAI: Indian government bond yields are set to open higher on Friday as the widening conflict with Pakistan weighs on risk appetite. The benchmark 10-year yield will likely open 1-2 basis points (bps) higher, a trader at a private bank said, after closing at 6.3976% in the previous session. The 10-year yield rose 10 bps intraday on Thursday, from the day's low of 6.3093%. Investors see further upward pressure, expecting the yields to test the 6.50% level if frictions between the two countries worsen. Pakistan's armed forces launched multiple attacks using drones and other munitions along India's entire western border on the intervening night of Thursday and Friday, the Indian Army said in a post on X on Friday. 'Market is going to be extremely volatile as operation Sindoor is expected to continue,' said Venkatakrishnan Srinivasan, founder and managing partner at debt advisory firm Rockfort Fincap. Indian bond yields seen steady as traders stay put amid India-Pakistan tensions 'Yields will move depending on the impact and damage on both sides.' Meanwhile, New Delhi is set to sell bonds worth 320 billion rupees ($3.72 billion) later in the day, while the central bank is set to buy 250 billion rupees of debt as a part of its scheduled open market operation. The Reserve Bank of India's debt purchase could provide some relief to the market, but demand for the auction will be tested as people have grown more risk averse, traders said.
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Business Standard
08-05-2025
- Business
- Business Standard
RBI lifts short-term, concentration limits for FPIs in corporate debt
The RBI has removed short-term and concentration limits on FPI investments in corporate debt to ease access and deepen market participation Mumbai The Reserve Bank of India (RBI) on Thursday scrapped 'short-term investment limit' and 'concentration limit' for investments by foreign portfolio investors (FPIs) in corporate debt securities, to provide greater ease of investment to FPIs. 'On a review, and with a view to providing greater ease of investment to FPIs, it has been decided to withdraw the requirement for investments by FPIs in corporate debt securities to comply with the short-term investment limit and the concentration limit,' the central bank said in a notification. These revised norms will come into effect immediately. Market participants described the move as a positive step toward deepening the corporate bond market, though its impact will also depend on the attractiveness of yields. 'This is a very positive step to deepen the corporate bond market, but it depends upon how FPIs will react to that, because yields have to be attractive for them. If we look at March and April data, FPIs withdrew money from debt because of the narrowing of the yield spread,' said Venkatakrishnan Srinivasan, founder and managing partner of Rockfort Fincap LLP. Foreign investors net sold around ₹14,379 crore worth of domestic debt in April as the yield spread between US 10-year benchmark bond and domestic 10-year benchmark bond narrowed below 200 basis points (bps). They pulled out ₹13,314 crore via debt-general limit route, NSDL data showed. This month, FPIs have net sold around ₹3,177 crore as of Wednesday (May 7) via general limit route. However, they have net bought ₹781 crore during the same period under the fully accessible route (FAR). Foreign investors had net sold the highest amount of ₹11,139 crore worth of Indian government securities designated under the FAR in April since the official inclusion of domestic securities in the J P Morgan indices.
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Business Standard
05-05-2025
- Business
- Business Standard
India sees debut listing of residential mortgage-backed securities
India saw the listing of its first residential mortgage-backed securities sold through the bidding route on Monday. The housing finance regulator expects firms to raise Rs 10,000 crore to Rs 20,000 crore ($1.2 billion to $2.4 billion) through these instruments in the current financial year. The funds would be raised across seven to 10 transactions over the year, National Housing Bank Managing Director Sanjay Shukla said in Mumbai. Residential mortgage-backed securities, securities with residential mortgages as the underlying asset, are common across global markets. Non-bank financier LIC Housing Finance last week raised Rs 1,000 crore through 20-year securities at a coupon of 7.26 per cent, payable on a monthly basis. It listed these on the National Stock Exchange of India on Monday. In March, the National Housing Bank set up a firm to facilitate the development of the residential mortgage-backed securities market by providing opportunities to long-term investors like insurers, pension and provident funds. For LIC Housing Finance's issue, a special purpose vehicle India Residential Mortgage Trust 2025 01 issued pass-through certificates backed by a housing loan receivables pool of Rs 1,112 crore originated by the financier. The notes are rated AAA (SO) by CRISIL and CARE. The successful placement of LIC Housing's securities will help other housing finance companies to issue similar ones, said Venkatakrishnan Srinivasan, founder and managing partner at debt advisory firm Rockfort Fincap.
