NTPC pre-closes Rs 1,750-crore tax-free bond issue today...

 

State-run National Thermal Power Corp (NTPC) said on Thursday it has pre-closed its Rs 1,750-crore bond issue which received a good response from investors by getting over-subscribed 3.3 times.

"The Company has exercised the option of early closure of its public issue of tax-free secured redeemable non-convertible bonds which was opened on December 3 and was scheduled to close on December 16. The issue will now close today," NTPC said in a regulatory filing to the stock exchanges.

The issue was oversubscribed 3.3 times on Tuesday as against Rs 1,000 crore, the company has already collected about Rs 3,310 crore, Rs 2,310 crore above the base size.

This is the state-run company's first bond issue after a gap of over 20 years.

Under the offer, the company issued tax-free secured redeemable non-convertible bonds.

The base issue size aggregates to Rs 1,000 crore with an option to retain over-subscription up to Rs 750 crore for issuance of additional bonds, aggregating up to Rs 1,750 crore.

The funds raised through the issue would be utilised towards funding of capital expenditure and refinancing for meeting the debt requirement in ongoing projects.

ICICI Securities, A K Capital Services, Axis Capital, SBI Capital Markets and Kotak Mahindra Capital Company were the book-running lead managers of the issue.

Currently, NTPC has a capacity of over 42,000 MW and targets to add about 14,000 MW to its total capacity by the end of 2016-17.

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NTPC's tax-free bond issue oversubscribed 3.3 times...

 

State-run power major,  NTPC on Tuesday received an overwhelming response for its bond issue by garnering Rs 3,310 crore, much ahead of its scheduled closing. "The issue was oversubscribed by 3.3 times.

As against Rs 1,000 crore, NTPC has already collected about Rs 3,310 crore, Rs 2,310 crore above the base size," the company said in a statement.

The tax-free bond issue which opened on Monday was earlier scheduled to close on December 16 but will formally close Wednesday, a company official said.

This is the state-run company's first bond issue after a gap of over 20 years. Under the offer, the company issued tax-free secured redeemable non-convertible bonds. The base issue size aggregates to Rs 1,000 crore with an option to retain over-subscription up to Rs 750 crore for issuance of additional bonds, aggregating up to Rs 1,750 crore.

The funds raised through the issue would be utilised towards funding of capital expenditure and refinancing for meeting the debt requirement in ongoing projects.

The company in the statement said the QIB (Qualified Institutional Buyers) oversubscribed by 4.2 times, garnering Rs 423 crore against allocation of Rs 100 crore. "Corporates contributed Rs 1,374 crore against allocation of Rs 250 crore, oversubscribed by 5.5 times," the statement said, adding that HNI (High Networth Individuals) also chipped in with Rs 851 crore against allocation of Rs 250 crore and over-subscription of 3.4 times.

The company, last month, filed a prospectus with the Registrar of Companies (RoC), Delhi and Haryana in connection with its proposed public issue of tax-free secured redeemable non-convertible bonds, NTPC said.

The lead managers to the issue are ICICI Securities, A K Capital Services, Axis Capital, SBI Capital Markets and Kotak Mahindra Capital Company.

Currently, NTPC has a capacity of nearly 42,000 MW and targets to add about 14,000 MW to its total capacity by the end of 2016-17.

Shares of NTPC closed at Rs 145.70 apiece, down 1.09 per cent on the BSE.

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NTPC tax-free bond issue of Rs.1750 crore opens Tuesday...

 

State-run National Thermal Power Corp. (NTPC) said its bond issue to raise up to Rs.1,750 crore will open Tuesday.

"The issue will open on December 3, 2013, and is scheduled to close on December 16, 2013," NTPC chairman Arup Roy Choudhury told media persons here.

 

This is the biggest national power producer's first bond issue in over 20 years. The company will issue tax-free secured redeemable non-convertible bonds.

"The base issue size aggregates to Rs.1,000 crore with an option to retain over-subscription up to Rs.750 crore for issuance of additional bonds, aggregating to up to Rs.1,750 crore," NTPC said in a statement.

According to the company, funds raised through the issue would be used for funding capital expenditure and refinancing to meet the debt requirements of ongoing projects.

NTPC has a capacity of nearly 42,000 MW and aims to add around 14,000 MW to its total capacity by the end of 2016-17.

Lead managers to the issue are ICICI Securities, A K Capital Services, Axis Capital, SBI Capital Markets and Kotak Mahindra Capital Company.

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NTPC gets nod for Rs 1,750 crore tax-free bond...

 

The infrastructure bond market is in for some big action. The Central Board of Direct Taxes (CBDT) has allowed state-run generation utility NTPC to issue tax-free bonds aggregating Rs 1,750 crore in the remaining part of the current fiscal.

This would be the first of the Rs 50,000 crore tax-free infrastructure bonds that the government had said in the Budget it would issue this fiscal. ToI had on July 11 first reported NTPC seeking permission for floating bonds worth Rs 2,500 crore.

The bonds would be issued with tenures of 10, 15 or 20 years. NTPC had sought the long gestation period in view of the long time it takes to build power projects, which would be funded through the proceeds. Interest income on the bonds would be tax-free throughout their tenure. Retail investors, including resident/non-resident individuals and Hindu Undivided Families, would be paid 0.25% higher interest than other categories of subscribers.

But retail investors would be eligible to apply for a maximum of Rs 10 lakh worth of bonds.

NTPC expects to incur a capital expenditure of Rs 20,200 crore in 2013-14 on various heads. The utility expects to fund Rs 7,959 crore of this from internal resources and raise debt of Rs 12,241 crore. The bonds would form part of the debt component.

NTPC has a target of adding 14,038 mw to its total capacity by the end of 2016-17. It has completed projects to add some 4,170 mw generation capacity in  2012-13. With this, the company's total capacity stands at 41,184 mw. This is set to rise to 50,000 mw by the end of the 12th Plan.

NTPC has been issuing bonds since 1985-86 to fund its capital expenditure and has an impeccable track record of servicing the papers. Major credit ratings agencies had assigned AAA rating to its papers. The company plans to price the bonds attractively to ensure its success, sources said but declined to give details. The bonds will carry SLR (statutory liquidity ratio) tag. This will give the papers stature of a government instrument. SLR tags make bonds attractive for banks to subscribe as their investment is treated as liquid under their requirement of keeping a particular sum in cash, gold or government securities.

Often, banks prefer investing in some or the other interest-yielding security rather than keeping cash. If banks can invest in a bond and still that investment is treated as liquid for meeting the SLR ratio, then the bank would invest in such a bond rather than keeping money lying idle.

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