BPCL raises Rs 1240 crore from offshore bond sale

MUMBAI: State-run Bharat Petroleum Corporation or BPCL has raised Swiss Franc 175 million or $200 million that equals to about Rs 1,240 crore by selling offshore bonds bearing a coupon rate at 2.988%. Securities will be maturing in December, 2019.

This is the first Swiss Franc denominated bond issuances after a gap of two years. Rural Electrification Corporation or REC had brought in a similar issuance for Swiss Franc 200 million in January-February, 2012.

“We are the first Indian corporate to raise CHF (Swiss Franc) bonds. REC unlike us, is more of a financial institution,” a BPCL spokesperson told ET adding that they will be using this fund to meet working capital requirements.

The Reserve Bank of India has permitted BPCL to raise USD 1 billion in FY14 from offshore bond markets where typically fund managers, insurers and pension funds invest. Earlier in the financial year, BPCL mopped up USD 800 million in two tranches. With this latest issue, they have exhausted the full limit.

In October, BPCL raised USD 500 million through a 10-year note carrying a coupon of 4.625%.

Deutsche Bank, UBS, BNP Paribas are some of the investment bankers for the issue. They held a road-show on Wednesday in Switzerland and fixed the interest rate late evening. Global rating company - Fitch has assigned BBB- stable rating to the issue.

These securities are called Public Fixed Rate Bonds, similar nature to Regulation S category in US where bonds may not be necessarily offered and sold within US.