MUMBAI: Global investors including Blackrock, Lombard, Washington State Investment Fund, China Asset Management, Fidelity Investment, Goldman Sachs Private Bank were among others to bid selectively for offshore bonds, launched by Adani Green Energy and Axis Bank Wednesday.
Both the issuances obtained multiple times higher subscriptions with funding costs tightening by 30-33 basis points.
Axis Bank decided to retail about $600 million out of an estimated $2.3 billion subscription bids until publication of this report, sources said. Adani Green raised $750 million out of total bids estimated at $3.5 billion.
While Axis Bank sold Additional Tier 1 papers with ‘sustainable’ or ESG tag, Adani Green mopped up funds for capital investments.
“The issuer shall use the proceeds towards eligible green project categories and eligible social project categories set out in the issuer’s sustainable financing framework,” said the Axis Bank term sheet, seen by ET.
Adani was offering three-year securities with initial price guidance of 4.7 per cent. Axis perpetual papers were initially guided to offer 4.4 per cent, with a five-year call.
Adani Green yielded 4.375 percent finally, and Axis bonds likely settled at 4.10 percent, dealers said.
Oppenheimer, Emirates NBD, HSBC Asset Management L&R Capital, China Everbright Securities bid for Axis Bank papers. Besides, Credit Suisse AG and Hong Kong-based Gaoteng wanted to own Adani papers.
Adani Green will likely use the proceeds for “onward lending to issuer’s subsidiaries for capital expenditure requirements to fund the development of utility green projects”.
Both pricings are likely to be tighter by 20 basis points from initial guidance, executives said.
Last month, ET reported on both issues.
The bank is seeking to raise up to $1 billion, while Adani Green is attempting to garner about $700 million.
Global Rating company Moody’s assigned B1(hyb) or (B+ in simple rating terminology) grade to Axis bonds. The rating rank is three notches lower than the bank’s general creditworthiness.
On August 26, ET wrote that Axis Bank was planning to raise up to $1 billion via offshore AT1 bonds, also known as perpetual papers.
HSBC, Citi, MUFG, JP Morgan, Bank of America, BNP Paribas, Standard Chartered and Societe Generale are among others that are helping the bank sell those bonds to international investors.
This issue is the second after HDFC Bank tapped global investors for the first time raising AT1 securities for $1 billion.
On August 9, ET wrote that Adani Green Energy was set to raise about $600 million through overseas bonds to quicken the execution of renewable projects in the next two years.
Barclays, MUFG, DBS Bank, BNP Paribas, Standard Chartered, and Mizuho are among the investment bankers working on the deal.
Individual investment banks, investors and issuers could not be immediately reached.
Moody’s Investors Service assigned a Ba3 (or BB-) rating to the dollar-denominated debt securities of Adani Green.
While the Adani bonds will be listed on the Singapore Stock Exchange, Gujarat GIFT City is the fund-raising platform for Axis.