Realty firm Prestige Estates Projects today said it has raised Rs 500 crore through issue of non-convertible debentures and the fund would be utilised for retiring high cost debt, expansion and acquisition.
ICICI Prudential and Kotak Mutual Fund invested in the NCDs issued by Prestige Estates.
Bengaluru-based Prestige has raised the funds at a coupon rate of 11.27 per annum payable monthly.
"We are extremely pleased with the strong appetite for our credit from high quality investors in our debut non- convertible debentures issuance - demonstrating the strength of our credit profile," company's CMD Irfan Razack said in a statement.
Prestige Estates Executive Director and Chief Financial Officer Venkat K Narayana said the transaction evinced strong interest from mutual funds.
"With this issuance, we have further diversified our funding sources and have established a credit curve across tenure buckets in the local fixed income market. Funds will be used for expansion, acquisition and retirement of high cost debt," he added.
When contacted, Narayana said the company would use about half of the funds raised through NCDs to retire costlier debt.
As on March 31, 2015, he said the company's consolidated debt stood at Rs 3,200 crore, half of which is through LRD (lease rental discounting).
The deal was split across three tranches of Rs 150 crore, Rs 300 crore and Rs 50 crore with maturity of July 2018 (36 months), July 2020 (60 months) and April 2018 (33 months) respectively.
The deal was upsized from the original size of Rs 300 crore to accommodate strong investor interest.
"Tightest coupon achieved by any Indian real estate player in similar rating category. The deal represents one of the largest issuances this year by a similar rated issuer," the statement said.
