PFC raises Rs 6,252 crore via issuance of bonds with different maturities

DME Development issues its first green bond

State-owned Power Finance Corporation (PFC) raised Rs 6,252 crore on Monday through the issuance of bonds with different maturities. The company raised Rs 3,200 crore via 15-year bonds at a coupon of 7.11 per cent and Rs 3,052 crore via 10-year bonds at a coupon of 7.10 per cent.

 

“The PFC issuance has seen coupons tighten by 10–15 basis points, with the secondary yield at 7.23 per cent, reflecting robust demand. This strong interest is driven by long-term investors such as large insurance companies and pension funds, aligning with their asset-liability management (ALM) needs,” said Venkatakrishnan Srinivasan, founder and managing partner of Rockfort Fincap LLP.

 

“After a hiatus, PFC’s return to the market has likely spurred pent-up demand, particularly for long-tenor bonds, which are witnessing a seasonal uptick in interest from pension funds during December and January. The significant bid-coverage ratio underscores the favourable sentiment in the market,” he added.

 

Meanwhile, DME Development Limited, a fully-owned special-purpose vehicle (SPV) of the National Highways Authority of India (NHAI) tasked with constructing the Delhi-Mumbai Expressway, raised Rs 775 crore through 10-year Green Bonds at a coupon of 7.23 per cent, payable semi-annually, as per market expectations.

 

DME Development last tapped the bond market in February, raising Rs 2,896 crore via 15-year bonds at a semi-annual coupon of 7.55 per cent.

 

DME Development is a special-purpose vehicle established by the National Highways Authority of India in August 2020. It was created specifically for the construction of the greenfield Delhi-Mumbai Expressway, which traverses Delhi and the states of Rajasthan, Madhya Pradesh, Gujarat, and Maharashtra. The company oversees 1,277 km of the expressway, out of the total length of 1,384 km.

 

Separately, Export-Import Bank of India (Exim Bank) plans to raise Rs 2,500 crore through 5-year bonds on December 11, 2024.