India’s two state-run firms to issue over $500mn of debt in August, sources say

MUMBAI: Indian state-run companies NHPC and NTPC Green Energy will raise around 45 billion rupees (about $512.6 million) through the sale of short-term bonds this month, three sources aware of the matter said on Tuesday.

Hydropower company NHPC is set to raise around 20 billion rupees through the sale of two-year or three-year bonds and should be the first of the two companies to come up with the issue, the sources said.

NTPC Green Energy, a subsidiary of integrated power company NTPC, will make its debut in the bond market by raising 20 billion rupees to 25 billion rupees through five-year bonds, according to the sources.

“NTPC Green Energy is keen to go for shorter duration paper, but may also opt for 10-year notes if it gets sufficient interest from investors,” one of the sources said.

The sources requested anonymity as the talks are private.

Both the companies did not reply to a Reuters email seeking comment.

NHPC had raised around 19.45 billion rupees in early May through separately transferable redeemable principal part bonds with six-to-15-year maturities.

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“Short-end rates are lower and there is a decent spread between a three-to-five year and a 10-year paper, which is encouraging both the firms to go for such issuance,” the second source said.

Market participants expect the short-term bond yields to ease further as the Reserve Bank of India’s monetary policy decision, due later in the day, is expected to boost demand for bonds.