On November 24, state-owned Canara Bank is allegedly going to issue bonds valued at ₹5,000 crore. According to analysts in the market, these bonds which fall under the category of infrastructure bonds will mature on November 29, 2033, after a duration of ten years.
With the option to retain oversubscription amounts up to ₹4,000 crore, the initial issue size is set at ₹1,000 crore, making the total aggregate issuance ₹5,000 crore.
November 29 is the day that the bonds are due and payable, which is when the issuers and investors exchange the bonds and money. The bonds have received a “AAA” rating from CARE Ratings and India Ratings.
Media reports state that earlier in the day, REC also raised ₹2,899.69 crore by issuing 10-year bonds with a coupon rate of 7.71 percent.
REC Ltd. intends to issue two bonds totaling ₹6,000 crore on November 23. The report states that the company hopes to receive ₹3,000 crore from the 10-year and 2.5-year bonds.
Furthermore, the Indian Railway Finance Corporation was able to successfully obtain ₹2,404 crore on November 21 by way of bonds with a three-year maturity period and an interest rate of 7.68 percent. On the other hand, the Small Industries Development Bank of India raised ₹4,887 crore by issuing bonds with a coupon rate of 7.83 percent for a period of five years.
Bonds give businesses the ability to borrow large sums of money at attractive interest rates in order to invest in diversification and expansion. Furthermore, compared to bank loans, which frequently have stricter terms, bonds give businesses more operational flexibility.
