Sebi Nod Sought For Rs 5000cr Idbi Bonds

IDBI has sought Sebis umbrella approval for a Rs 5,000 crore retail bond issue. The IDBI move comes within a week of Sebi granting umbrella approval for ICICIs Rs 3,000 crore retail bond issue

Senior IDBI officials confirmed that they had applied to Sebi and added that the issue would be named Umbrella Flexibond. In its prospectus filed with Sebi last Friday, IDBI has sought clearance for 10 instruments, said sources. The instruments include an infrastructure bond, regular return bond, deep discount bond, growing interest bond, multi-option bond, gift bond, education bond, retirement bond, inflation index bond and floating rate bond.

While Sebi is in the process of drafting the guidelines for the umbrella issue, the two financial institutions have taken the lead in using this concept as a tool to hit the retail capital market according to their convenience, said market sources.

Both IDBI and ICICI have not yet fixed any interest rate bands on their umbrella issues. Interestingly, IDBI has received the Central Board of Direct Taxes approval to raise the entire sum of Rs 5,000 crore under a tax exemption scheme, while ICICI would seek CBDTs clearance for tax exemption every time it issues retail bonds.