Bank of Baroda to issue infrastructure bonds worth ₹5,000 crore today

Earlier on November 18, the bank had in a statement said that its capital raising committee has given the nod to raise up to ₹15,000 crore, comprising not more than ₹5,000 crore via the issuance of tier-II debt bonds and a maximum of ₹10,000 crore through infrastructure bonds.

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Details for today

Further, ₹5,000 crore worth of the infrastructure bonds will be issued today, on November 30, as part of the bank’s initial set. This offering will have a base issue of ₹1,000 crore and a green shoe option of up to ₹4,000 crore for a period ranging from 7-10 years, it said.

Bidding for these bonds is scheduled between 11 am and 12 pm today, via the NSE, sources told Moneycontrol. The pay-in date for these bonds is December 1, marking the exchange between the issuer and investors.

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Rated ‘AAA’ with a ‘Stable’ outlook by CRISIL and India Ratings, these bonds require a minimum application size of ₹1 lakh, available in multiples of the same amount.

Bonds see momentum

In the dynamic landscape of the financial markets, the corporate bond market has experienced remarkable expansion.

“In FY23, private placements garnered ₹7.5 lakh crore ($94 billion), and in the current fiscal year, FY24, we have already witnessed a substantial raise of ₹4.15 lakh crore ($52 billion) by October. It’s to be noted that this strong momentum includes obtaining money through private placements,” said Abhijit Roy, CEO, of GoldenPi.

Also Read: Infrastructure financial institutions, NABFID, PSUs, and others aiming to collect ₹30,000 crore through bond sale

As per Roy, pivotal developments are poised to shape the landscape into FY25. “SEBI’s initiative to reduce the ticket size from ₹10 lakh to ₹1 lakh since January 1, 2023, fosters increased retail investor participation which has increased from a mere 0.7 percent in FY22 to 2 percent in FY23 and is currently at 4 percent with the potential for further the positive outlook for further increase in the very near future,” he said.

In the public sector, the National Bank of Financing Infrastructure and Development (NABFID), along with Public Sector Banks (PSBs) and Indian Infrastructure Financiers, are aiming to generate funds worth ₹30,000 ahead of elections. While NABFID is planning a bond sale of around ₹10,000 crore, the Delhi-Mumbai Expressway is mulling to collect worth ₹3,000 crore.

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Updated: 30 Nov 2023, 07:28 AM IST