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Export-Import Bank of India (Exim Bank) has raised $500 million through dollar-denominated Regulation S (Reg S) bonds for a maturity tenure of 5.5 years. The bonds have been priced at US Treasury plus 220 basis points, said an issue arranger.
Reg S bonds are offered to non-US residents and qualified institutional buyers under an exception to US securities laws enacted in 1990, and do not enjoy the same legal protection as other issues.
The transaction was supported by an extremely strong order book oversubscribed by more than six times, with very high quality global investors participating in size, an issue arranger added.
Three Indian issuers have sold dollar debentures totaling $1.55 billion so far this year, according to data compiled by Bloomberg.
Yield premiums on dollar notes for the nation's companies narrowed to 344.2 basis points more than treasuries on March 21, the least since June, HSBC Holdings indices show.
Seven Indian companies sold dollar bonds in the three months to June 2013 totalling $4.05 billion. A sale of more than $200 million by Exim Bank would also make this quarter the busiest in terms of volumes since that period.
"Spreads seem favourable for Indian borrowers at the moment," said A S Thiyaga Rajan, a senior managing director at Aquarius Investment Advisors in Singapore. "There's a positive disposition towards India on perceptions India has weathered the storm of Fed tapering."
US currency bond yields for Indian borrowers average 5.28 per cent, close to the lowest in nine months, JPMorgan Chase indices show. Costs may rise after the US Federal Reserve halts bond purchases. The US central bank is expected to announce the stimulus programme's end at its October meeting.
