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NTPC tax-free bonds issue subscribed 11 times on day 1

NTPC was among seven state-run entities, including NHAI and IRFC, which were given permission to raise Rs 40,000 crore in the current fiscal through tax-free bonds.

twitter-logo PTI   New Delhi     Last Updated: September 24, 2015  | 07:46 IST
NTPC tax-free bonds issue subscribed 11 times on Day 1
Picture for representation purpose only. Source: Reuters

State-run NTPC's Rs 700-crore public issue of tax-free bonds was oversubscribed by 11.04 times on the first day of opening.

"By the end of Day 1 i.e.by 5.00 pm, the issue was oversubscribed by 11.04 times of the base issue size of Rs 400 crore and 6.31 times of the overall issue size of Rs 700 crore," the company said in a statement.

"The retail portion was oversubscribed by 6.60 times (of the total issue size allocated to retail), reflecting a huge confidence of retail investors in the company", it said.

"A total demand of over Rs 4,400 crore was generated against the issue size of Rs 700 crore. NTPC's issue was the first tax-free bond issuance in this fiscal", it said.

Earlier in July, the government had approved the plan to raise Rs 1,000 crore through tax-free bonds, including Rs 700 crore through public issue.

NTPC was among seven state-run entities, including NHAI and IRFC, which were given permission to raise Rs 40,000 crore in the current fiscal through tax-free bonds.

"The 40 per cent of the issue i.e. Rs 280 crore is reserved for allocation to retail category. The remaining issue will be for non-retail investors including QIB, corporates and High Networth Indians," NTPC Director (Finance) K Biswal had earlier said.

The issues has three tenures - 10 years, 15 years and 20 years.

For retail investors the coupon rate is 7.36 per cent for 10 years tenure, 7.53 per cent for 15 years and 7.62 per cent for 20 years.

Similarly for non-retail investors, the coupon rate is 7.11 per cent for 10 years, 7.28 per cent for 15 years and 7.37 per cent for 20 years.

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