Axis Bank to raise funds through infra bonds, may announce issue in Sept
The Indian government's strong capital expenditure push, with budget allocation at a record Rs 11.11 trillion ($132.40 billion), is prompting banks to raise funds
 "Axis Bank to raise funds through infra bonds, may announce issue in Sept")
India's Axis Bank is set to join several other lenders in raising funds through infrastructure bonds and may announce the issue in September, three sources, including two merchant bankers, said.
The Indian government's strong capital expenditure push, with budget allocation at a record Rs 11.11 trillion ($132.40 billion), is prompting banks to raise funds via infrastructure bond issues amid a persistent gap between lending and deposit.
"Axis Bank is planning and should come up with an infrastructure bond issue soon," an official said, requesting anonymity as the discussions are still private.
"We are seeing good demand for capex, especially from the private sector. This is not for refinancing but fresh loans," the official added.
Axis Bank's infrastructure notes are rated AAA by Crisil and ICRA and had last raised 38.51 billion rupees ($459.07 million) in March through 10-year infrastructure bonds at a coupon of 7.64 per cent.
Banks, excluding financial institutions, have raised 436 billion rupees through infrastructure bonds in the first five months of the current financial year, and bankers expect them to cross last year's record issuance of 574 billion rupees.
Infrastructure bonds are issued to finance long-term development projects.
Axis Bank has already started discussions and could look to raise around 40-50 billion rupees through 10-year bonds, one of the bankers said, adding the private lender "should invite bids once some tie up with any large investor is finalised." Axis Bank refused to comment on the bond issue.
The lender will join the likes of ICICI Bank, Canara Bank, Bank of Maharashtra, Bank of India, Bank of Baroda and the nation's largest lender State Bank of India, which has issued infrastructure bonds twice between April and August.
Traders are also expecting HDFC Bank to issue infrastructure bonds soon and ICICI Bank to announce a second such issue this year.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)