12 July 2024 Punjab Khabarnama : Appetite for overseas bonds is back after a two-year gap with demand from foreign investors picking up, experts said.
According to Prime Database, fundraising through overseas bonds by Indian companies in 2024 till June has surpassed the overall issuances in 2023. So far this year, companies have raised Rs 32,619 crore, blowing past the Rs 31,218 crore raised in all of calendar 2023. In 2022, companies had raised Rs 45,237 crore.
“This renewed activity is driven by multiple factors: India’s robust economic performance, reducing inflationary trends, fiscal consolidation and recent credit rating upgrades. Improved global liquidity conditions, lower hedging costs and strong investor preference for high-yield transactions have further bolstered this trend,” said Venkatakrishnan Srinivasan, founder and managing partner of Rockfort Fincap.
“Most corporates are raising funds from the overseas bond market due to better rates and can raise funds with longer tenures. In 2024, levels are coming off a bit and corporates think that rates are toppish,” said the head of treasury at a mid-sized company who did not wish to be named.
Earlier this year, India’s largest private sector lender HDFC Bank raised $750 million through two overseas bond issuances. It raised $300 million through bonds for a period of three years and $450 million for a five-year tenure.
