Masala bond issuance on the rise: Icra

Housing finance & asset financing non-bank companies emerged as leading borrowers

In the fourth quarter of the last financial year, 39 per cent of overseas funds worth $7.39 billion was through rupee-denominated bonds (RDBs) or masala bonds.
 
Since these bonds are raised in rupee, the issuer of the bonds doesn’t have to bear any exchange-rate risk and therefore the country as a whole gets into a safer zone as far as its overseas commitments are concerned.
 
“The trend of increasing RDB issuance is hence positive for such borrowers, not only from the risk aspect but also from the pricing perspective. This opening up of an alternative borrowing channel and