National Highways Authority of India (NHAI) has raised Rs 3,000 crore by selling the rupee-denominated masala bond that are now listed on London Stock Exchange. Union road transport minister Nitin Gadkari has marked the listing ceremony on Thursday in London reinforcing the view that the exchange platform is gaining popularity among Indian borrowers. “Our Government is fully committed to bridge the infrastructure deficit in the country,” said Gadkari.“We firmly believe that consistent high level public investment in transport infrastructure including Highways, Ports, Airports and Railways is going to accelerate the economic growth in the country,” he said.
The NHAI bond sale has obtained an overwhelming response from a wide range of investors, some of them have participated for the first time in the masala bond market. Some of the leading investors were still showing interest in the NHAI issue who may be brought into the fold in the near future,” a statement from roads ministry said.”It is interesting to note that the NHAI Masala Bond issue has attracted investors from across the spectrum with Asia contributing 60% of the subscription and the balance 40% coming from Europe.” The landmark bond issuance from NHAI, the government of India’s agency responsible for the management of India’s highways network, reinforces the ability of London’s global Masala bond market to support Indian infrastructure financing, LSE said in a press statement.
The bonds are the largest ever five-year issuance with the largest inaugural transaction in the masala bond market space. The bonds yield 7.3% yearly. The bond-listing follows Prime Minister Modi’s announcement of $ 1 billion or more than Rs 6,400 crore worth of masala bond sales in the UK, made during his visit to London in 2015. London Stock Exchange is increasingly becoming a hub for masala bond market as large institutions like Housing Development Finance Corp or HDFC, India’s largest mortgage lender, too listed its bonds earlier. In 2017, there have been five masala bond listings in London, raising $ 135 million equivalent. In total, 39 such bonds have been listed on London Stock Exchange, raising equivalent to $ 5.4 billion, said LSE.