HDFC to raise $750 million via Masala bonds

HDFC to raise $750 million via Masala bonds

In a first by any private sector Indian company, country’s largest mortgage lender HDFC will issue $750 million rupee-denominated bonds, also known as ‘Masala’ bonds, to overseas investors to improve financing prospects for domestic infrastructure projects.

HDFC has chosen London Stock Exchange for raising this fund.

“There is a renewed vigour in the India-UK relationship and HDFC is delighted to announce its intention to list its bonds on the London Stock Exchange,” HDFC Chairman Deepak S Parekh said in a joint statement.

The UK is a global hub for financial services, and the Reserve Bank of India’s guidelines permitting overseas rupee -denominated bonds will open up a new source of funding, he added.

Commenting on this, Nikhil Rathi, CEO, London Stock Exchange said: “This milestone issuance, the first-of-its kind globally, is a significant development for private sector Indian companies looking to access international capital to finance Indian infrastructure projects.”

The London Stock Exchange (LSE) has more Indian companies listed in equity and debt markets than any other international market and through MillenniumIT, LSEG also provides cutting edge technology to some of India’s leading exchanges, he said.

Besides, the London Stock Exchange Group today signed a Memorandum of Understanding (MoU) with Yes Bank to develop collaboration around bond and equity issuance, with a particular focus on ‘Green Infrastructure Finance’.

As part of the agreement, Yes Bank confirmed that it plans to list a ‘Green Bond’ of up to $500 million on the LSE by December 2016 and to raise further capital in London, potentially through the listing of Global Depository Receipts (GDR) as part of its overall USD 1 billion of equity capital raising plans.

The agreement was signed by LSE CEO Nikhil Rathi and Rana Kapoor, Managing Director & CEO, Yes Bank.