Aluminium major Hindalco has created a new record in terms of securing the lowest coupon rate for any Indian corporate by placing Rs 100 crore paper of 7-year maturity at a yield of 7.95 per cent per annum.
The issue has a 5-year put-and-call option and is the lowest yield achieved by any issuer in the last few decades. The spread works out to around 100 basis points over the corresponding gilt.
The paper has been rated at AAA by Crisil and has been placed by ICICI Securities and Finance Co. According to financial analysts, Hindalco is also among the most widely traded papers in the secondary market and deals at the lowest yields even among AAA papers.
This is not the first time that Hindalco has created a new benchmark with its coupon rates. In the previous financial year, the company had raised Rs 250 crore through the issue of two series of secured redeemable non-convertible debentures, first with a coupon rate of 9.75 per cent for Rs 200 crore and the second with a coupon rate of 9 per cent for Rs 50 crore. Both these coupons created a new benchmark at the time of issuance.
The company, which has been restructuring its debt portfolio, has repaid long term debts of Rs 55.74 crore in the previous financial year while a sum of Rs 72.32 crore will be repaid in the current financial year.
