HPCL raises USD 500 mn via bonds issue in foreign markets

State-owned Hindustan Petroleum Corp Ltd (HPCL) today said it has raised USD 500 million through a maiden 10-year US dollar bonds issue.
HPCL raised the money from investors in Asia, Europe and the Middle East to fund capital expenditure for ongoing and future domestic projects, the company said in a press statement here.
"This is HPCL's inaugural foray into the international bond market. The 10-year benchmark has a semi-annual coupon of 4 per cent per annum and a maturity date of July 12, 2027," it said.
The bonds offers investors a spread of 167.5 basis points over the US Treasury (UST) yield.

The issue received orders for more than USD 3 billion with over 225 investors consisting of very high quality accounts.
The notes are rated Baa3 by Moody's and BBB- by Fitch.

"At UST 167.5 basis points, this represents the tightest priced public issuance for 10-year USD bond issue from the Indian oil and gas sector sector and represents the tightest 10-year spread paid by an Indian corporate in the last decade in the international bond markets," the statement said.
The Notes will be listed on the Singapore Exchange Securities Trading Limited (SGX-ST)
Commenting on the occasion, Mukesh Kumar Surana, the Chairman and Managing Director of HPCL, said, "The issue has been oversubscribed by 6 times and managed to achieve a very strong price compression of 32.5 basic points from initial price guidance.

"It underscores investor's confidence in HPCL and establishes HPCL as one of the sought-after Indian state-owned enterprises credit in the international bond markets".
Citigroup, DBS Bank Ltd, MUFG, SBICAP and Standard Chartered Bank acted as joint book runners and joint lead managers for the issue.