Hindalco raises Rs 3,000 cr via bonds

HDFC Bank and Standard Chartered Bank were joint arrangers for the bond issue. Hindalco has been given an investment grade rating by rating agencies CRISIL and CARE.

“With no existing supply of Hindalco paper this provides an opportunity for building exposure to long tenor paper at attractive yields and benefit on capital gains as interest rates ease over the next few quarters,” said Alphonso Richard Das,president – finance at Hindalco.

“We are confident that this issuance will mark the return of the domestic corporate debt segment.”

“This issue is part of Hindalco’s efforts to achieve significant cost savings by reducing interest cost and lengthening the average maturity of debt,” a joint statement by HDFC Bank,Standard Chartered and Hindalco stated. “This issuance also significantly adds to the liquidity position of Hindalco and provides flexibility to determine its long term financing arrangements for large greenfield capital expenditure program that is already underway.”

HDFC Bank’s Rakesh Singh said that the issue is one of the largest NCD issuance by a private sector company in the recent past. “This is an excellent deal from Hindalco’s perspective to take advantage of the recent rate cut.”

On Wednesday,Hindalco’s shares on the BSE closed 0.58% lower at Rs 119.85.