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March 27, 2024

Indiabulls Housing Finance Draws Strong Interest for Dollar Social Bonds, Sets Lower Coupon Rate

Indiabulls Housing Finance has garnered significant attention in the financial markets as it accepted bids totaling $350 million for its dollar-denominated social bonds with a maturity period of three years and three months. The announcement was made by two prominent merchant bankers on Wednesday, marking a substantial stride for the non-banking finance company.

Reportedly, Indiabulls Housing Finance is slated to offer a coupon rate of 9.70 percent to investors, which is notably lower than the initially projected rate of 9.95 percent, as stated by banking sources familiar with the matter.

The issuance of these bonds saw the collaboration of several major financial institutions acting as joint bookrunners. Among them are Barclays, CLSA, Deutsche Bank, Elara Capital, Emirates NBD Capital, Nuvama, and UBS, reflecting a diverse and robust participation in the offering process.

According to the bankers involved, S&P is expected to assign a credit rating of B to these bonds. The proceeds from the issuance are earmarked for various purposes, with a primary focus on facilitating onward lending activities, thereby underlining Indiabulls Housing Finance’s commitment to fostering socio-economic development through responsible financial initiatives.

The acceptance of bids for these dollar-denominated social bonds underscores investor confidence in Indiabulls Housing Finance and its strategic vision. Despite the prevailing economic uncertainties, the company’s ability to secure substantial investments at a lower coupon rate underscores its strong market positioning and investor appeal.

This move aligns with the company’s broader sustainability objectives, as social bonds are specifically designed to finance projects that deliver positive social outcomes. By tapping into the global capital markets through such offerings, Indiabulls Housing Finance not only diversifies its funding sources but also reinforces its commitment to driving positive social change through responsible financial practices.

The decision to lower the coupon rate demonstrates the company’s agility in responding to market dynamics while ensuring attractive returns for investors. It also reflects Indiabulls Housing Finance’s proactive approach in optimizing its capital structure and cost of funding, thereby enhancing its overall financial resilience and competitiveness in the market.

The involvement of reputed joint bookrunners further enhances the credibility and visibility of the offering, signaling a strong vote of confidence from the financial community. This collaborative effort underscores the collective commitment towards advancing sustainable finance practices and fostering inclusive growth across various sectors.

In conclusion, Indiabulls Housing Finance’s successful acceptance of bids for its dollar-denominated social bonds, coupled with the decision to lower the coupon rate, reflects its proactive stance in navigating the evolving market landscape while staying true to its sustainability goals. As the company continues to expand its footprint and drive positive impact, investors can look forward to participating in its journey towards building a more resilient and inclusive financial ecosystem.

Jhumpa Lahiri

Jhumpa Lahiri

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