IndianOil raises Rs 1,700 cr via domestic bond issue
New Delhi   06-May-2013

State-owned IndianOil on Thursday said it has raised Rs 1,700 crore through a domestic bond issue at a new benchmark low interest rate of 8.14 per cent.

IndianOil’s issue of secured redeemable non-convertible bonds opened for subscription on private placement basis today and received an “overwhelming response from all segments of investors”, it said in a statement.

“The issue, launched with an original size of Rs 500 crore, was over-subscribed by over six times with overall subscription aggregating to over Rs 3,000 crore,” it said.

IndianOil, which decided a cut-off coupon rate of 8.14 per cent per annum, will use the proceeds for meeting its working capital requirements. The ‘AAA’ rated bonds have a maturity of five-years with put and call option at the end of the 18 months and 36 months.

“IndianOil, the largest refiner in the country, has raised Rs 1,700 crore from the Indian bond market at 8.14 per cent, setting a new benchmark borrowing rate,” the statement said. The issue, placed through book-building route received an overwhelming response from all segments of investors which included banks, insurance companies, primarily dealers, mutual funds, financial institutions.

“The success of the issue again acknowledges the strong confidence of investors in IndianOil,” it added.

The book building for deal was announced on October 4 on the back of a highly successful one day road show in Singapore, which was attended by over 50 prospective investors including private banks and fund managers, the statement said.

The book consisted of orders from over 100 investors and the profile included fund managers (22 per cent), banks (18 per cent) and private banks (60 per cent). In terms of geography, 75 per cent orders came from Singapore and 25 per cent from rest of Asia, it said.

The issue, launched with an original size of Rs 500 crore, was subscribed over six times with overall subscription aggregating over Rs 3,000 crore. IndianOil has decided a cut-off coupon rate of 8.14 per cent per annum.