WASHINGTON: Adani Ports and Special Economic Zone (APSEZ), India’s largest ports operator is planning to raise at least $500 million by selling bonds to global investors to refinance some existing loans and for capital expenditure, two people familiar with the sale said. This sale, if it goes through, will be the second bond sale by the company after it raised $500 million in January and could be at a yield lower than the company paid six months ago. Investor roadshows for this bond have started in Asia and London on Tuesday. “These bonds are also open to US investors. It is likely that investor demand will allow the company to raise more than $500 million,” said one of the persons cited above.
The yield on the Adani bond issued in January 2017 has come off from 3.99 per cent to 3.40 per cent as demand for Indian paper remains strong globally.“The spread on Adani’s bonds has come down and we are confident that the latest bonds will be priced at a tighter yield. It remains to be seen how much the company decides to keep finally,” said the second person cited above. Global rating agency Moody’s has assigned a Baa3 rating to the bonds in line with the company’s previous bonds. “The rating primarily reflects the company’s strong market position as the largest port developer and operator in India by cargo volume, and the strength of its landmark Mundra PortBSE 0.54 % concession in Gujarat,” Moody’s said.
APSEZ could not be immediately reached for comment. On Monday, Moody’s had changed the company’s ratings outlook to stable from negative citing the stabilization in the company’s operating performance and a decline in its financial leverage. APSEZ reported a 27 per cent year-on-year (YoY) growth in container traffic in fiscal year ending March 2017, in line with management’s guidance of increasing the share of containers in the overall mix and reducing the dependence on coal. Barclays, Citibank, Standard Chartered and SBI Capital Markets are the bankers to the latest bond sale.
