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Tata Capital Housing Finance is set to raise up to INR 11.25 billion through the issuance of five-year bonds, according to market participants. The proposed fundraising comprises a base issue size of INR 10 billion and a greenshoe option of INR 1.25 billion. The company has fixed a coupon rate of 8.15% and invited commitment bids for the issue on June 10. The bonds have received AAA ratings from CRISIL and ICRA, reflecting the highest level of creditworthiness. The proposed debt issuance comes as non-banking financial companies and housing finance firms continue to access domestic bond markets to secure long-term funding for lending operations, including housing finance and retail credit activities.
Tata Capital Housing Finance plans to raise up to INR 11.25 billion through a bond issuance with a tenure of five years, according to bankers involved in the transaction. The company has scheduled the issue for June 10 and will seek investor commitments through a bidding process as it looks to strengthen its funding base through the domestic debt market.
The proposed fundraising comprises a base issue size of INR 10 billion along with a greenshoe option of INR 1.25 billion. The greenshoe mechanism will allow the company to retain additional subscriptions beyond the base issue if investor demand exceeds the initial offering amount.
Market participants said the bonds will carry a fixed coupon rate of 8.15%. The company has invited commitment bids from investors ahead of the issuance, with the transaction expected to attract participation from banks, mutual funds, insurance companies, pension funds and other institutional investors seeking highly rated fixed-income securities.
The bonds have been assigned AAA ratings by both CRISIL and ICRA, indicating the highest degree of safety regarding timely servicing of financial obligations. The strong ratings are expected to support investor appetite for the issue amid continued demand for high-quality corporate debt instruments.
Tata Capital Housing Finance, a housing finance subsidiary of the Tata Capital group, provides home loans, loans against property and other housing-related financing products. Like other housing finance companies and non-banking financial institutions, it regularly accesses debt markets to raise long-term funds that support its lending activities and asset growth.
The proposed issuance comes at a time when financial institutions are actively tapping India's bond market to diversify funding sources and manage borrowing costs. The domestic debt market has witnessed a steady flow of issuances from banks, non-banking financial companies, housing finance firms and government-backed institutions seeking to raise medium and long-term capital.
The latest transaction is among several bond issues scheduled for June 10. Market participants are also tracking planned debt issuances by other financial institutions, including Axis Finance and the National Bank for Agriculture and Rural Development (NABARD), reflecting sustained activity in the corporate bond market.
Tata Capital Housing Finance had not responded to a request for comment regarding the proposed fundraising at the time details of the issue emerged. The final amount raised will depend on investor demand and the extent to which the company exercises the greenshoe option.
The planned bond sale highlights the continued reliance of housing finance companies on debt capital markets for funding, particularly as demand for housing credit and retail lending remains an important component of India's broader financial and real estate ecosystem.
Source - Reuters
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