HDFC Life Insurance To Raise Rs 1,000 Crore Via 10-Year NCD

HDFC Life Insurance Co. plans to raise Rs 1,000 crore through private placement of non-convertible debentures maturing in 10 years for funding business growth.

The fund would be raised through unsecured, rated, listed, subordinated, redeemable, fully-paid-up, non-cumulative NCDs for an aggregate nominal value of Rs 1,000 crore on a private placement basis, the company said in an exchange filing.

The coupon rate on the 10-year NCD has been fixed at 8.05% per annum, the filing said. The capital-raising committee of the HDFC Life Insurance Board made this decision, it said Wednesday.

"The debentures proposed to be issued shall neither be secured nor covered by a guarantee of the company or other arrangements that legally or economically enhance the seniority of the claims as against the claims of the company's policyholders and all other creditors," it said.

The debentures shall be listed on the Wholesale Debt Market segment of the National Stock Exchange of India Ltd.

Earlier on Sept. 24, HDFC Life Insurance Co. said its capital raising committee will meet on Sept. 27 to approve the commercial terms of the Rs 2,000 crore NCD issue that was announced two months ago.

Shares of HDFC Life Insurance Co. Ltd., closed 1.25% higher to Rs 719 apiece, compared to a 0.12% decline at the benchmark NSE Nifty 50.

It has risen 16.61% in the last 12 months and 10.92% on a year-to-date basis. The total traded volume in the day stood at 1.74 times its 30-day average. The relative strength index was at 55.83.

28 out of the 33 analysts tracking the company have a 'buy' rating on the stock, four recommend a 'hold' and one suggest a 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 8.8%.