PFC and IRFC to raise ₹3,500 Crore through bond issuance.

13 Feb 2024 , 01:57 PM

According to the sources, the Indian Railway Finance Corporation (IRFC) and Power Finance Corporation (PFC) intend to issue bonds worth up to ₹3,500. The bonds each have a ten-year maturity.

Up to ₹3,000 Crore will be raised by IRFC, including ₹2,500 Crore in greenshoe, and up to ₹500 Crore by PFC, including ₹400 Crore in greenshoe. 

An underwriting agreement’s ‘greenshoe option’ gives the underwriter the authority to sell investors more bonds than the issuer had originally intended in the event that investor demand for a security issue exceeds expectations.

The PFC bond auction will be held on February 13 from 10:30 a.m. to 11:30 a.m. on the BSE’s electronic bidding site. Meanwhile, the BSE’s bidding platform will host the IRFC bond auction on February 14 from 10 to 11 a.m.

The PFC and IRFC bonds have pay-in dates of February 15 and 16, respectively. Both have received a ‘AAA’ rating from ICRA, CRISIL, and CARE.

Bond sales took place on February 12 for Canara Bank, Tata Capital Ltd, Piramal Capital & Housing Finance Ltd, and Spandana Sphoorty Financial Ltd. With Basel-III compliant Additional Tier-1 bonds offering an 8.40 % interest rate, Canara Bank was able to raise ₹2,000 Crore.

Canara Bank plans to raise a total of ₹2,000 Crore, of which ₹1,500 Crore will come from oversubscription.

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