Hudco bond issue garners Rs 1,076 cr

The bond issue hit the market on Sep 17. The issue size is Rs 750 crore, with an option to retain over-subscription up to Rs 4,809.20 crore

State-owned Housing and Urban Development Corporation (Hudco) on Friday said its public issue of tax-free bonds had been subscribed about 1.5 times, with  the company receiving bids worth Rs 1,076 crore so far.

The bond issue hit the market on September 17 and would close on October 14. The issue size is Rs 750 crore, with an option to retain over-subscription up to Rs 4,809 crore.

“Our bonds are doing well. We have crossed Rs 1,000 crore. The issue has been over-subscribed by 150 per cent so far. We hope to raise the entire amount of Rs 4,810 crore before issue closes,” Hudco Chairman and Managing Director V P Baligar said.

The finance ministry has allowed Hudco to raise Rs 5,000 crore through bonds during the current financial year, of which Rs 190.8 crore has been raised last month through private placement to institutional investors.     The funds would be utilised to finance the government’s housing and urban infrastructure projects, Baligar added.

For retail investors applying for bonds up to Rs 10 lakh, the coupon rate shall be 8.39 per cent per annum for 10 years, 8.76 per cent for 15 years and 8.74 per cent for 20 years.

The bonds bear a coupon rate of 8.14 per cent per annum for 10 years, 8.51 per cent for 15 years and 8.49 per cent for 20 years for qualified institutional buyers, corporates and high net worth individuals.

This is the first public issue of tax-free bonds by Hudco in this financial year. The company had raised about Rs 2,400 crore during last financial year.

Hudco, a mini-ratna firm, is a techno-financial institution engaged in financing and promotion of housing and urban infrastructure projects throughout India.

The company posted a net profit of Rs 700 crore over a total revenue of Rs 2,923 crore during last financial year. It had sanctioned projects worth Rs 23,000 crore and disbursed Rs 6,000 crore in 2012-13.