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Who invested in ICICI Financial institution infra bonds?

MUMBAI: ICICI Financial institution, India’s largest personal sector lender by asset dimension, Friday raised Rs 3,001 crore through infrastructure bonds for the primary time in 4 years reflecting the rising optimism in constructing ports and roads in an economic system that’s anticipated to rebound steeply as vaccinations and slowing infections increase hopes.

The bonds provided 6.45 p.c with seven-year maturity. ICRA rated these papers with AAA (Steady) grade.

A minimum of two pension funds LIC New Pension Scheme (NPS) and UTI NPS, fund homes like Aditya Birla MF, Tata MF and insurer Bajaj Alliance possible subscribed to these papers by means of the bidding course of. The financial institution obtained and retained about one and a half dozen bids.

The proceeds will probably be used to lend to the infrastructure sector together with low-cost reasonably priced housing. ICICI Financial institution had final raised infrastructure bonds for Rs 4,000 crore in 2016-17.

Some banks are mentioned to have lapped up these top-rated debt securities by means of a bidding course of solely to promote down their holdings to completely different mutual funds together with SBI, HDFC and Tata Life Insurance coverage.

Particular person traders couldn’t be contacted instantly for feedback. ICICI Financial institution didn’t reply to ET’s request for remark until press time.

“Infrastructure bonds hit the market after an extended hole, suggesting that the borrower has pockets of deployments,” mentioned Ajay Manglunia, managing director – debt capital market, . “Demand for infrastructure credit score is regularly arising with the unfolding of the unlocking programme.”

The core dimension of the difficulty was pegged at Rs 1,000 crore with an choice to retain subscription as much as Rs 4,000 crore. Pension funds are prone to have owned bigger sums than mutual funds working as much as Rs 600 crore for a single bid.

“The financial institution’s present capital is adequate to help its development necessities over the medium time period and soak up the anticipated asset high quality shocks,” ICRA mentioned in a be aware.

ICICI Financial institution reported a 104 p.c bounce in its standalone web revenue for the monetary yr ended March 31, 2021, at Rs 16,192.68 crore.

Within the January-March quarter, the lender reported one other phenomenal rise of 260.47% year-on-year in web income.

“We stay optimistic on ICICIBANK, contemplating a robust steadiness sheet, robust development

in advances, excessive CASA (Present Account-Financial savings Account) ratio and enhancing asset high quality,” AnandRathi brokerage mentioned in a report.

Whole loans elevated by 14% year-on-year to Rs 7,33,729 crore as on March 31, 2021 from Rs 6,45,290 crore a yr in the past.

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