The bonds are of 10-year maturity and rated AAA with a stable outlook by Crisil and Care Ratings. The instruments are partly paid, secured, redeemable, non-convertible debentures and are ranked equal to the existing or future secured loans or NCDs issued or to be issued by Reliance. If Reliance raises the entire amount of ₹20,000 crore through the issuance, it would mark the largest ever fund-raising through bonds by an Indian corporate beyond the traditional lending sector of banking and financial services.Last year, HDFC had raised ₹25,000 crore through bonds as the housing financier looked to garner funds ahead of its merger with HDFC Bank.
RIL had last tapped the domestic debt markets in April 2020, a month after the national lockdown was imposed to prevent Covid-19 from spreading. Back then, Ambani- owned company had raised ₹2,795 crore through five-year bonds at a coupon rate of 7.40%. Listing out the end-uses of the proceeds from this week’s bond sale, Reliance’s information document said that up to 100% of the funds could be used for refinancing existing borrowings. Up to 50% of the proceeds could be used for ongoing capex while up to 50% of the funds could also be used for making investments in or lending to domestic subsidiaries where the shareholding of the parent company is more than 51%. Up to 25% of the funds raised could be used for any other purpose in the ordinary course of business.
Eligible investors for the bonds are all Qualified Institutional Buyers (QIB) and any non-QIB investors specifically mapped by Reliance on the BSE Bond EBP Platform.
The fund-raising plan comes at a time when Rel Jio, India’s top telco, has been rapidly expanding 5G networks and looking at countrywide coverage in a few months. Jio has launched 5G-based fixed wireless access (FWA) services that will ride on 5G network infrastructure.
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