In advanced talks with investors including home financiers
And, people familiar with the matter said.
The plan is to raise at least Rs 5,000 crore with an option to retain up to Rs 10,000 crore in case of high demand for bonds.
People said both the private banks could take a subscription of around Rs 2,500 crore, demand from other institutional investors would determine the final subscription size.
The bonds, which are likely to offer 7.80% with a maturity of 10 years, will be ready for sale later this week or early next week, the people said.
HDFC Ltd, ICICI Bank and Axis Bank did not comment.
“What is unique this time (Financial 2023) is that the mortgage lender is raising bonds in bulk for longer durations,” said Ajay Mangaluniya, managing director, Investment Grade Group.
, “Once merged, HFC will not be able to mobilize similar (secure) equipment (as proposed). With the increasing demand for home loans, it is also getting reasonable rates and good appetite, which may not be possible under a bank. ,
On July 26, HDFC had raised Rs 11,000 crore through local bonds offering 8% with a maturity of 10 years.
The benchmark bond yield at that time was around 7.35%. Sovereign gauge yield stood at 7.19 per cent on Tuesday.
The gap, or spread on the benchmark, remains in the range of 65-70 basis points as per the latest yield guidance.
on Tuesday,
Raised Rs 2,474 crore through perpetual bonds, which offered 7.88% under what is billed as “superior pricing”. Those additional tier-1 bonds are riskier quasi-equity instruments.
HDFC Limited is currently undergoing the process of merger with HDFC Bank. Two weeks ago the Competition Commission of India had approved the merger proposal.
In early August, HDFC raised $1.1 billion through syndicated loans.
The housing finance company reported a 22% increase in net profit for the first quarter of fiscal at Rs 3,669 crore, driven by strong credit demand from individuals and also helped by dividend income from subsidiaries.
The assets under management increased to Rs 6.71 lakh crore from Rs 5.74 lakh crore a year ago. Personal loans comprised 79% of AUM and grew by 19% year on year.
HDFC shares closed 3.37% higher at Rs 2446.20 on BSE on Tuesday.