To utilise money for expansion.
Indian Oil Corporation (IOC), the country’s biggest oil refining and marketing company, has raised Rs 1,400 crore from the domestic bond markets after a gap of nearly two-and-a-half years. The proceeds shall be utilised in capex of ongoing domestic projects.
The company, which sells diesel, kerosene and liquefied petroleum gas (LPG) at government regulated prices, has a borrowing of Rs 79,000 crore on its books, on delayed compensation for the loss on sale of products at controlled prices.
“IOC’s issue of secured redeemable non-convertible bonds opened for subscription on private placement basis on December 15,” the company said in a press statement here.
The ‘AAA’ rated bonds have a maturity of five years with put and call options at the end of the 18th month. “The issue has been placed through book-building route in a coupon range of 9.20 per cent to 9.45 per cent per annum, payable annually,” it said.
Stating the issue was well received by institutional investors, particularly foreign institutional investors and banks, IOC said it was launched with an original size of Rs 500 crore and was subscribed over three times, with subscription aggregating to about Rs 1,600 crore.
“IOC has decided a cut-off coupon rate of 9.28 per cent, that is, the lower of the book-building range,” it said.