HPCL’s ₹25 Billion Power Play: Five-Year Bonds Signal Confidence and Expansion

Hindustan Petroleum Corporation Limited (HPCL) has mobilized ₹25 billion (₹2,500 crore) through issue of rated, taxable, non-cumulative unsecured, redeemable, non-convertible debentures on private placement basis. Such debentures are part of HPCL's efforts to enhance its financials and fund its operational and capital expenditure requirements.

 

The NCDs of face value of ₹1 lakh will be listed on both NSE and BSE, making them more liquid for eligible institutional investors. The issue has a base size of ₹5 billion with green shoe option of ₹20 billion, enabling HPCL to retain oversubscription and achieve the issue size of ₹25 billion. These NCDs are issued for a period of 5 years with a Coupon Rate of 6.73% per annum. The offer was made to qualified institutional buyers and other eligible investors only in accordance with SEBI regulations. 

 

This move is reflective of HPCL's focus on prudent management of funds and its approach towards using debt market for effective capital raising. The raised proceeds would be used for general corporate purposes, funding capital expenditure, and refinancing outstanding borrowings as outlined in the offer document.

 

Source: The Economic Times