Sidbi, Nabfid and Hudco to tap debt capital market for ₹13,500 crore

Sidbi, Nabfid and Hudco will raise Rs 13,500 crore through bond issuances this week, even as higher yields and geopolitical risks continue to weigh on corporate debt fundraising

Large state-owned issuers, including Small Industries Development Bank of India (Sidbi), National Bank for Financing Infrastructure and Development (Nabfid), and Housing and Urban Development Corporation (Hudco), will tap the domestic debt capital market on Wednesday to raise ₹13,500 crore through bond issuances, sources said.

 

While Sidbi plans to raise ₹8,000 crore — comprising a base issue of ₹2,000 crore and a green shoe option of ₹6,000 crore — through bonds maturing in a little over three years, Nabfid aims to raise ₹4,000 crore, including a ₹1,000 crore base issue and a ₹3,000 crore green shoe option, via 10-year bonds.

 

Meanwhile, Hudco plans to raise ₹1,500 crore that would comprise a base issue of ₹500 crore and a green shoe option of ₹1,000 crore through perpetual bonds with a call option after 10 years.

 

The bonds will carry a one-time step-up of 50 basis points in the coupon rate, applicable on the first call option date of February 13, 2036, if the issuer does not exercise the call option on that date. Only qualified institutional buyers (QIBs) will be eligible to bid for the Hudco perpetual non-convertible debentures (NCDs).

 

Perpetual bonds are debt instruments that do not have a maturity date, meaning the issuer is not obligated to repay the principal, while continuing to pay interest to investors indefinitely, unless the bonds are redeemed through a call option.

 

Fundraising through the corporate bond market has remained relatively subdued in FY26, as elevated yields, driven by persistent geopolitical tensions, have dampened issuer appetite. This moderation has come despite the Reserve Bank of India cutting the policy repo rate by 125 basis points, as risk aversion and higher term premia have limited the transmission of lower policy rates to corporate bond yields.

 

During the nine of 2025-26 (April-December period), funds raised through this route declined 6 per cent year-on-year to ₹6.76 trillion, compared with ₹7.19 trillion in the year-ago period.