Reliance Industries (RIL) plans to refinance a significant portion of about $12 billion of borrowings that mature over the next three years and may sell bonds to repay the debt, according to company executives with knowledge of the matter.
India’s largest company by market value will repay some of the debt coming due, mostly bonds and interest, the officials said, asking not to be identified discussing confidential matters. Reliance’s repayments from 2018 through 2020 will be its biggest for any previous three-year period and comprise $8.14 billion of term loans, $3.52 billion of bonds and a $300 million revolving loan, according to data compiled by Bloomberg. It also has about $1.65 billion of interest payments, the data show.
Reliance’s borrowings have ballooned over the past five years as the group invested in building its telecom business, a petcoke gasification unit and in expanding petrochemical capacities. The plan to tap the bond market is part of a larger trend that’s seen Indian companies choosing bonds over loans for the first time in at least a decade. One of the fastest economic growth rates in the world and Prime Minister Narendra Modi’s reforms have attracted global funds to India, reducing costs for issuers.
“There is a lot of appetite among investors for Indian issuers,” said Raj Kothari, head of trading at Jay Capital in London. “Reliance being the biggest company from India, with solid finances, there would be
no challenges for the firm in refinancing its debt.”
Reliance has sufficient cash though it won’t use it to repay maturing debt as the company’s credit ratings and strong finances enable it to raise funds at competitive rates, the people said.
A Reliance spokesman did not respond to an e-mail seeking comment. S&P Global Ratings has a BBB+ score on Reliance’s long-term debt, two levels above the sovereign, while Moody’s has the company at Baa2, a notch above the Indian government.
 "RIL Chairman Mukesh Ambani with his son, Akash. Pic: Kamlesh Pednekar")