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Fullerton India raises Rs 500cr though Masala Bonds

Times of India:  October 18, 2016

Mumbai: Fullerton India Credit Company, an NBFC, on Monday sold Rupee-denominated bonds, popularly called Masala Bonds, worth Rs 500 crore to investors abroad at a yearly interest rate of 8.125%. The unrated bonds had a tenure of three years and one month, a release from the company said.

The company is set to use the money for onward lending and other financing activities. The bonds will be listed on the Singapore Stock Exchange, it said.

"This is a landmark transaction and enables Fullerton India to tap and develop a new source of funding. It reaffirms our position as leaders in creating innovative financing options. This also leverages the recent reforms from the government and regulators. It matches our asset profile well and finances Fullerton India's future growth plans ideally", Shantanu Mitra, MD & CEO, Fullerton India was quoted in the release.

Last month Indiabulls Housing Finance raised Rs 1,300 crore through Masala Bonds. And in July, HDFC had raised Rs 3,000 crore though this emerging financing mode.

Masala bonds are fixed income instruments through which an Indian or a multi-lateral entity can raise funds abroad, Unlike foreign currency bonds, in Masala Bonds bond investors bear the currency risk.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.