WHY COMPANIES MOBILIZE FUNDS THROUGH ISSUE OF BONDS ?
Issuing bonds is one way for companies to raise money for their working capital or for their capital needs . A bond functions as a loan between an investor and a company. The investor agrees to give the company a certain amount of money for a specific period of time. In exchange, the investor receives periodic interest payments.
WHY ARE COMPANIES ISSUING CORPORATE BONDS TO RAISE FUNDS?PIRAMAL CAPITAL RAISES $150 MILLION FROM BOND SALE
As of November 2022, hundreds of bonds are listed on both the BSE and NSE. Bonds can provide an efficient and cost-effective source of funding. By issuing bonds on the open market, a company may have relatively more freedom to operate in its own way while also raising money to finance day-to-day operations, fund a new project, expand into a new market, etc. In addition, bonds can lower companies’ long-term or short-term funding costs.
PIRAMAL CAPITAL RAISES $150 MILLION FROM BOND SALE
Piramal Capital and Housing Finance Limited (earlier Dewan Housing Finance Corporation Ltd. (DHFL)) is a non-deposit taking housing finance company (NBFC), headquartered in Mumbai with branches in major cities across India. DHFL was established to enable access to economical housing finance to the lower and middle income groups in semi-urban and rural parts of India.
Piramal Capital and Housing Finance recently has raised $150 million through a global bond sale. The bonds will be issued at a yield of 7.078 per cent and will have to be repaid in 3.32 years, according to a company statement. The company, a wholly-owned subsidiary of Piramal Enterprises, had raised USD 300 million from a sustainability bond issuance in July this year.
The issue saw subscriptions of USD 520 million or an oversubscription of 3.5 times.
From a geographical spread perspective, 92 per cent of the funds were raised from Asia, while the rest was from Europe, Middle East and Africa.
Piramal said that 95 per cent of the money raised was from asset managers and 5 per cent was from banks.
EARLIER BOND ISSUES
· Axis Bank is planning to roll out AT-1 bond sale for a Rs 3,000-cr fundraise.
· SBI raises Rs 10,000 crores through infrastructure bonds at 7.36% coupon in June 2024.
· Mahindra Finance, Shriram Transport Finance, India Bulls Housing have already issued bonds and raised funds.
· Bajaj Finance, Hero Fincorp, L&T Finance, Tata Financial Services ,& IIFL Financial are planning to issue bonds shortly.
R V Seckar Practicing Company Secretary ,
7904719295,
rvsekar2007@gmail.com
No comments:
Post a Comment