India's 3rd largest airport operator eyes Oct close for over $500 mn bond

India's Bangalore International Airport Ltd (BIAL) plans to raise over Rs 46.3 billion ($535 million) via a second tranche of bonds by early October, three sources told Reuters on Monday.

Earlier this month, the company which operates the country's third-busiest airport, raised Rs 43.62 billion through the sale of 15-year bonds at a coupon of 8.15 per cent payable on a monthly basis.

BIAL will raise the funds through its second tranche at a similar rate as the first transaction, the sources added.

All the sources requested anonymity as the talks are still private. The company did not immediately respond to a Reuters email seeking comment.

The bonds are rated AAA by Crisil Ratings, India Ratings and ICRA.

SBI Capital Markets was the arranger of the previous issue, and will also be the arranger for the second tranche, two of the sources added.

The planned bond issue will also be of 15-year maturity and will be privately placed and will not be auctioned on the electronic bond platform like the first tranche, the sources said.

"The deal was closed with wide participation from banks, insurance companies and infrastructure focused funds," said one of the sources.

The money raised will be used for refinancing of existing debt and new capital expenditure, the person said.

BIAL is planning to undertake capital expenditure worth Rs 155 billion over financial years 2026 to 2030 for capacity expansion, according to an ICRA report.

This is expected to increase its passenger handling capacity to 80-85 million each year from 51.5 million passengers per annum currently.