Varanasi Aurangabad NH-2 Tollway raises $316.3m in debut dollar bond

Varanasi Aurangabad NH-2 Tollway Private Limited (VAH) has raised $316.3 million through a dollar-denominated bond issuance, marking its debut in the international bond market. The bonds, carrying a 5.900% coupon rate, tighter than the initial price guidance of 6.375%, will mature in nearly nine years. Proceeds will be used for refinancing and capital expenditure.

Deutsche Bank acted as the sole global coordinator for the transaction.

The bond issuance saw strong demand, with the order book surpassing $3.3 billion, an oversubscription of approximately 10.4 times. The offering attracted 144 investors across key global markets.


“The overwhelming response from global investors underscores both credit quality of the Issuer and the increasing appetite of international capital for infrastructure assets in India,” said Sameer Gupta, Head of India & Southeast Asia DCM at Deutsche Bank.

With this issuance, Varanasi Aurangabad NH Tollway has become the first Indian road concession company to raise US dollar-denominated debt in international capital markets and to get an investment-grade rating from Moody’s and Fitch. Fitch Ratings has assigned an expected rating of 'BBB-(EXP)' with a Stable Outlook for the proposed US dollar senior secured .

VAH, backed by ROADIS, the project company responsible for expanding the 192.4 km Varanasi to Aurangabad segment of National Highway 2 (NH-2) from four lanes to six, under a long-term concession agreement. ROADIS, the road investment platform of Canadian pension fund PSP Investments, controls VAH and continues to strengthen its footprint in India’s infrastructure sector.