NTPC Makes Second Bond Offering for $311.5 Million


The National Thermal Power Corporation (NTPC), a government-owned power utility, has priced its second, rupee-denominated five-year masala bond offering for Rs.20 billion (~$311.5 million), in the international markets on April 25, 2017. In doing so, the state-run power generator became the only state-owned enterprise to tap the Masala Bonds market twice.

This is the eighth offering under the company’s $4 billion (~Rs.256.8 billion) Medium Term Note (MTN) program since it was set up in 2006, taking the cumulative amount raised under the program to nearly $3.46 billion (~Rs.222.16 billion).

Given NTPC’s strong credentials in the International Bond Market, the issue was oversubscribed with participation of more than 40 accounts. Based on the strong order book, the notes have been priced at a coupon of 7.25 percent payable annually.

The five-year senior unsecured masala bonds of NTPC have been issued at the lowest yield for any masala bond by an Indian issuer to date and have been priced within AAA Corporate Bonds of equivalent tenor in the domestic market.

The company intends to use the proceeds of the issue to finance its ongoing and new power projects within India. Axis Bank, Barclays Bank, ICICI, MUFG, and Standard Chartered Bank were the bookrunners for the offering. These bonds will be listed on the Singapore and London Stock exchanges.

Mercom previously reported that the NTPC recently upsized the MTN program to $6 billion (~385.5 billion). Mercom also reported, in March 2017, that the NTPC raised Rs.20 billion (~$305.47 million) through the issuance of green masala bonds in the overseas market.