HDFC to Raise Rs 8,000 Crore via Private Placement Bonds for Mortgage Lending Expansion
Press Releases India
HDFC, one of India’s leading mortgage lenders, has announced plans to raise a substantial amount of capital through bonds issued on a private placement basis. The company aims to secure up to Rs 8,000 crore through this fundraising initiative. The primary instrument for this capital mobilization will be unsecured redeemable non-convertible debentures (NCDs). The initial offering of NCDs will be set at a base size of Rs 3,000 crore, with an option to retain an over-subscription of up to Rs 5,000 crore.
This fundraising exercise is part of HDFC’s broader strategy to raise a significant sum of Rs 57,000 crore through non-convertible debentures issued in tranches. The company’s board of directors approved this proposal on March 27, which involved the issuance of unsecured redeemable non-convertible debentures under a shelf placement memorandum. The debentures will be offered in various tranches on a private placement basis. The company had obtained the necessary approval from its shareholders during the 45th annual general meeting held on June 30, 2022, in accordance with its stated plans for fundraising.
In addition to this capital raise, HDFC’s board of directors, during the same meeting, also approved an increase in the overall borrowing powers of the corporation. The borrowing limit was raised from Rs 6 lakh crore to Rs 6.50 lakh crore, reflecting the company’s ambitious growth plans and its confidence in the financial markets.
This move by HDFC highlights its strategic intent to expand its mortgage lending operations and strengthen its position in the housing finance sector. By securing substantial funds through the issuance of NCDs, HDFC aims to fuel its growth initiatives and meet the increasing demand for housing finance in the market.
HDFC has built a solid reputation as a leading mortgage lender in India, and this fundraising exercise is expected to further bolster its financial capabilities and provide the necessary resources to tap into new opportunities in the real estate sector.
