Grasim, Punjab & Sind Bank to issue Rs 5,000-cr bonds
Grasim Industries and Punjab & Sind Bank are set to raise up to ₹5,000 crore between them through 10-year bonds in two separate transactions on Wednesday, according to people familiar with the proposed issuances.
Grasim Industries, the flagship company of Aditya Birla Group, a conglomerate with $100-billion market capitalisation, is looking to raise ₹2,000 crore at a coupon rate of around 7.21%, the sources said.
«Long-term investors are expected to show significant interest in this issue, so I expect it to be oversubscribed,» one of the sources cited above said. «These companies don't raise funds very often, and hence investors will be looking forward to this.»
Rating agencies Icra and Crisil have assigned the Grasim bond an AAA rating. The ratings reflect Grasim's leading position in the textile and chemical businesses, its strong financial risk profile, and high financial flexibility due to being the holding company of Aditya Birla Group's key listed companies, such as UltraTech Cement and Aditya Birla Capital.
«Grasim's entry into the decorative paints business, with overall capital expenditure (capex) of ₹10,000 crore (over fiscals 2023 to 2025), and the business-to-business (B2B) e-commerce segment, with a total outlay of ₹2,000 crore (over the next five years), will add size and diversity to its existing standalone business,» Crisil said.
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