Ambani’s Reliance raises $2.4 billion in asset-backed securities

Billionaire Mukesh Ambani’s Reliance Group companies on Monday raised about 210 billion rupees ($2.4 billion) through asset-backed securities, people familiar with the matter said, making it one of the largest such deals in India this year.
About three-fourths of the issuance was bought by the country’s leading asset managers, including Aditya Birla Sun Life Asset Management Co., HDFC Asset Management Co., ICICI Prudential Asset Management Co., Nippon Life India Asset Management Ltd. and SBI Funds Management Ltd., the people said, asking not to be identified as the information is not yet public.

The securities, known locally as pass-through certificates, were issued by three trusts — Radhakrishna Securitisation Trust, Shivshakti Securitisation Trust and Siddhivinayak Securitisation Trust — with maturities of about three, four and five years respectively, and carried an average coupon of 7.75%, the people said.


The Reliance offering drew a robust response, as it gave investors a chance to own top-rated asset-backed securities in a market still dominated by non-bank financial firms. The deal also adds heft to India’s securitization market, which remains relatively small but is on track to reach a record high of more than 2.5 trillion rupees in issuance this fiscal year ending March, according to ICRA, an affiliate of Moody’s Ratings.

“We are one of the top investors, as we found the instrument and the structure fitting into our investment requirements,” said A Balasubramanian, chief executive officer of Aditya Birla Sun Life AMC.

Strong demand allowed Reliance to upsize the transaction, arranged by Barclays Plc, from the initially planned 180 billion rupees to 210 billion rupees, the people said.

Representatives at Reliance Industries and ICICI Prudential AMC declined to comment, while spokespersons for SBI Funds, HDFC AMC, Nippon Life, and Barclays did not immediately respond to Bloomberg’s emails seeking comment.

Backed by loan receivables from Digital Fibre Infrastructure Trust, an investment infrastructure trust set up by Reliance Industrial Investments and Holdings Ltd., the pass-through certificates are also supported by payouts under an options agreement between the ABS originators and promoter entities of Reliance Industries, the people said.