Infra major Shapoorji Pallonji today said it has raised Rs 2,610 crore through bond market to refinance existing debt taken for its Jammu-Udhampur highway project.
The company said it raised the money by selling non-convertible debentures through the special purpose vehicle, SP Jammu-Udhampur Highway Ltd, and the proceeds are meant for refinance its existing debt which is combination of foreign currency and rupee loans. The bond will fetch an annual average coupon of 9.15 per cent, payable semi-annually.
The bond sale and the resultant debt repayment will help the company to lower its interest cost as well as eliminate exchange rate risks, the firm said in a statement.
The company claimed that the bond sale is the largest debt raised in the road sector in recent months.
The Pallonji group won 64.58-km Jammu-Udhampur stretch on a build, operate and transfer annuity basis from the National Highways Authority of India (NHAI).
"This project has many firsts: the first under construction project to be financed by an ECB, completed ahead of schedule and received bonus and now this marquee issuance which will enable us to significantly reduce interest cost and mitigate exchange risks," its director S Mukundan said.
The HSBC and Kotak Mahindra Bank were joint-lead arrangers to the issuance, it added.
