PFC to issue debentures worth Rs 5,000 cr on Jan 15

at 4:13 pm
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New Delhi (NVI): India’s largest power sector lender, Power Finance Corporation Ltd (PFC) will open its Rs 5,000 crores public issue of secured, redeemable non-convertible debentures (NCD) on January 15, the Ministry of Power said.

According to the Power Ministry, the base issue size is Rs 500 crores, with an option to retain oversubscription of up to Rs 4,500 crores aggregating up to 5,000 crores, which is within the shelf limit of Rs 10,000 crores.

The NCDs have a face value of Rs 1,000 each. The tranche I issue is scheduled to close on January 29, 2021, with an option of early closure or extension as decided by PFC’s board of directors, the statement added.

The ministry also said that tranche I offers options for tenures of 3, 5, 10 and 15 years. The 3-year tenure NCD in Series I will offer a fixed coupon rate of 4.65 per cent to 4.80 per cent per annum (pa), while the 5 year tenure NCD in Series II will offer fixed coupon rate of 5.65 per cent to 5.80 per cent pa depending on the category of investors.

The 10-year tenure NCDs offers options of both fixed and floating rates of interest. The fixed coupon rate is 6.63 per cent to 7.00 per cent pa, it added

On the other hand, the floating coupon rate is spread of 55 basis points to 80 basis points, subject to floor and cap rate depending on the category of investors. The 15-year tenure NCD offers a range of fixed coupon rates with maximum coupon rate of 7.15 per cent pa, the statement noted.

However, the minimum application size is for 10 NCDs aggregating to Rs 10,000 collectively across all series of NCDs and in multiples of 1 NCD of face value of Rs 1000 each thereafter.

The ministry further said that the NCDs are proposed to be listed on BSE Ltd. The lead managers to the issue are Trust Investment Advisors Private Limited, A. K. Capital Services Limited, Edelweiss Financial Services Limited and JM Financial Limited.

Apart from this, the issue has received the highest rating from credit rating agencies Crisil, CARE and Icra and the ratings indicate high degree of trust regarding timely servicing of financial obligations and such instruments carry lowest credit risk, the statement added.