NHB To Float First 10-Year Bond Issue In A Decade Amid Strong Investor Demand

The corporate bond market is likely to witness a long-term bond issuance by National Housing Bank after a decade, five people told NDTV Profit.National Housing Bank has drawn its plans to raise up to Rs 5,000 crore through the issue of 10-year bonds and has invited bids on Thursday, according to the issue details uploaded on the electronic bidding platform.The issue has a base size of Rs 2,000 crore and has a greenshoe option of Rs 3,000 crore. Given that long-term investors are expected to lap up this bond issue, NHB is expecting to issue them at a coupon of 7-7.05%, the people said.The recent 15-year issuance by Rural Electrification Corp at 7.09%, when the company raised Rs 3000 crore also showed strong appetite among long-term investors.Currently, yield on the 10-year bond issued by National Bank for Agriculture and Rural Development, is trading around 7.2-7.25%. The NABARD 10-year bond is considered a benchmark in the corporate bond market..SBI May Issue Third Tranche Of 15-Year Infra Bonds By Next Week.Proceeds of the upcoming 10-year bond issue will be used for lending towards housing finance companies and for refinancing affordable housing assets, the person involved in the transaction said.Bidding for the housing financial institution's 10-year bond will take place on the National Stock Exchange's electronic bidding platform from 11 AM to 1 PM on Thursday. The bonds are rated AAA by CRISIL Ratings and will be allotted on Nov 19.NHB has tied up with Life Insurance Corp of India and Employees' Provident Fund Organisation for its long-term bond issue, the people quoted above said. In 2014, the regulator of housing finance companies had raised Rs 2,100 crore through public issue of tax-free bonds maturing in 10, 15 and 20 years. This was the last time it had raised long-term funds.Usually, NHB raises funds up to seven-year maturity bracket. However, strong demand from insurance companies and pension funds amid tight rates in the longer-tenure segment has led NHB to opt for a 10-year bond, the first of the five people quoted above said.So far in the current financial year, NHB has hit the bond market four times, raising a total of Rs 12,200 crore, through bonds maturing in three to seven years..'When RBI Increased Rates, Bond Funds Did Not Make Money': Anand Rathi's Feroze Azeez

NHB To Float First 10-Year Bond Issue In A Decade Amid Strong Investor Demand

The issue has a base size of Rs 2,000 crore and has a greenshoe option of Rs 3,000 crore.

NDTV Profit

NDTV Profit

Follow Us

DOWNLOAD THE APP

NHB To Float First 10-Year Bond Issue In A Decade Amid Strong Investor Demand

The issue has a base size of Rs 2,000 crore and has a greenshoe option of Rs 3,000 crore.

Choose a plan

Follow Us

DOWNLOAD THE APP