RECLTD

July 7 (Reuters) - REC Limited RECM.NS:

• REC - UMRED POWER TRANSMISSION, SAKOLI POWER TRANSMISSION INCORPORATED AS SUBSIDIARY OF RECPDCL

Source text: ID:nBSE9T6BML

Further company coverage: RECM.NS

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By Dharamraj Dhutia

MUMBAI, June 16 (Reuters) - Three Indian state-run companies are likely to delay raising funds through deep-discount zero-coupon bonds as investor appetite has weakened, three merchant bankers said.

State-run Indian Railway Finance Corp INID.NS, Housing and Urban Development Corp HUDC.NS and REC RECM.NS were set to test the market but have been advised by their bankers to hold off, they said.

"We have advised companies to wait for at least two to three months, because under the current scenario, there is no appetite for these bonds," one of the bankers said.

The bankers requested anonymity as they are not authorised to speak to media. None of the companies replied to Reuters' emails seeking comment.

Deep-discount bonds are typically issued at a discount of over 20%-25% to their face value and do not pay interest.

Last Monday, Power Finance Corp was forced to withdraw its planned deep-discount bond issue for the second time in under six weeks due to weak demand.

"The recent pickup in yields and escalating geopolitical situation in the Middle East will further sway investors away from these instruments for the time being," said Umesh Khandelwal, chief business officer at bond arranger Tipsons Group.

Refinitiv benchmark AAA-rated 10-year corporate bond yield has risen nearly 20 basis points since the central bank changed its policy stance to "neutral" from "accommodative" on June 6.

Market participants have highlighted concerns of excess supply as the Indian government has approved issuance of such bonds worth 495 billion rupees ($5.6 billion) and more state-run companies are expected to get the go-ahead. The firms have to raise these funds by March 2027.

A lack of liquidity in the secondary market and losses faced by investors of an issuance by REC are also acting as deterrents, traders said.

In September 2024, REC raised 50 billion rupees through deep-discount bonds at a yield of 6.25%.

Companies that have received approval to issue deep-discount bonds:

($1 = 86.0400 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Mrigank Dhaniwala)

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MUMBAI, June 11 (Reuters) - India's REC RECM.NS has accepted bids worth 49.23 billion rupees ($575.7 million) for bonds maturing in one year and 10 months and in four years and seven months, three merchant bankers said on Friday.

The state-run company has invited coupon and commitment bids for both the issues on Wednesday, they said.

The company did not reply to a Reuters email seeking comment.

Here is the list of deals reported so far on June 11:

*Size includes base plus greenshoe for some issues

($1 = 85.5070 Indian rupees)

(Reporting by Dharamraj Dhutia and Khushi Malhotra; Editing by Sonia Cheema)

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MUMBAI, June 6 (Reuters) - India's REC RECM.NS plans to raise 60 billion rupees ($583.4 million), which includes a greenshoe option of 50 billion rupees, selling bonds maturing in one year and 10 months and in four years and seven months, three merchant bankers said on Friday.

The state-run company has invited coupon and commitment bids for both the issues on Wednesday, they said.

Here is the list of deals reported so far on June 6:

*Size includes base plus greenshoe for some issues

($1 = 85.7000 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Mrigank Dhaniwala)

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Updates with outlook on demand

By Dharamraj Dhutia

MUMBAI, June 5 (Reuters) - India's Power Finance Corp (PFC) PWFC.NS is planning to raise funds through the sale of zero-coupon, deep-discount bonds for the second time in five weeks, but with a reduced size, merchant bankers said.

The state-owned non-banking financial firm aims to raise 20 billion rupees ($233 million), including a greenshoe option of 15 billion rupees, through bonds maturing in 10 years and one month and has invited bids from bankers and investors on June 9.

The company did not reply to a Reuters email seeking comment.

In April, PFC was forced to shelve its planned bond issue to raise 35 billion rupees, including a greenshoe option of 29 billion rupees, after weak investor appetite led to unattractive pricing.

The cutoff at the base size would have been 6.54%, while that for the full size would have worked out to 6.90%, merchant bankers had said.

Meanwhile, another state-run financial company, REC RECM.NS, received approval for a fundraise through deep-discount bonds for a second time in less than a year.

It has until March 2027 to raise up to 50 billion rupees ($581.7 million) through the sale of zero-coupon, deep-discount bonds (ZCB), with a tenor of 10 years and six months.

Deep-discount bonds, a rarely used corporate debt structure, are issued at a steep discount - often more than 20%-25% off face value - and don't pay regular interest, similar to zero-coupon notes, eliminating reinvestment risk.

Instead, investors get their returns on investment when the bonds are redeemed at face value at maturity.

REC had raised 50 billion rupees through ZCB at a yield of 6.25% in September 2024.

DEMAND SCENARIO

While the previous issue of PFC had to be shelved due to weak demand, merchant bankers do not expect a similar fate this time around.

"The company must have already spoken to some large investors that would place bids, and also the quantum is smaller this time, so we think it should go through," a banker said.

Still, traders anticipate PFC will have to pay more than what REC had paid last year.

($1 = 85.8310 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Sumana Nandy and Mrigank Dhaniwala)

(([email protected];))

June 4 (Reuters) - REC Limited RECM.NS:

• REC LIMITED - PROPOSES RAISING FUNDS UP TO 1.55 TRILLION RUPEES

• REC LIMITED - TO STRIKE OFF RAJGARH III POWER TRANSMISSION

Source text: ID:nBSE1DHSDb

Further company coverage: RECM.NS

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MUMBAI, May 19 (Reuters) - India's REC RECM.NS plans to raise 60 billion rupees ($702.5 million), which includes a greenshoe option of 50 billion rupees, selling bonds maturing in two years and eight months, and in 10 years and 11 months, three merchant bankers said on Monday.

The state-run company has invited coupon and commitment bids for both issues on Wednesday, they said.

The company did not reply to a Reuters email seeking comment.

Here is the list of deals reported so far on May 19:

*Size includes base plus greenshoe for some issues

($1 = 85.4050 Indian rupees)

(Reporting by Dharamraj Dhutia
Editing by Eileen Soreng)

(([email protected]))

By Khushi Malhotra and Dharamraj Dhutia

MUMBAI, April 30 (Reuters) - India's Power Finance Corp (PFC) PWFC.NS was forced to shelve its plan to raise funds through zero-coupon, deep-discount bonds after weak investor appetite led to unattractive pricing, merchant bankers said on Wednesday.

The state-run company had plans to raise 35 billion rupees ($414.3 million), which included 29 billion rupees of a greenshoe option, through bonds with a maturity of 10 years and one month.

The company received bids worth only around 58 billion rupees, a stark difference from the large bids that fellow state-run firm REC RECM.NS had received in September for a similar structured bond issue.

The cutoff at the base size would have been 6.54%, while that for the full size would have worked out to 6.90%, bankers added.

"There was hardly any difference between the yield for a regular bond and the zero-coupon bond, and hence it did not make much sense for the company to accept bids at such levels," a banker with a brokerage said.

Deep-discount bonds are generally issued at a more than 20%-25% discount to their face value and do not pay regular interest, a feature similar to zero-coupon notes that removes reinvestment risks.

"Since there is expected to be a lot of supply of such notes this year, investors were not chasing the auction, while broader caution with regard to the outlook for long-term yields also weighed," another banker said.

In March, PFC received the government's approval to raise up to 100 billion rupees through this rarely used corporate bond structure.

HUDCO got clearance earlier this month to raise 50 billion rupees for such an issuance, while half a dozen other companies have also approached the government for similar approvals.

In September, REC had raised 50 billion rupees through such an issue at a yield of 6.25%.

($1 = 84.4810 Indian rupees)

(Reporting by Khushi Malhotra and Dharamraj Dhutia; Editing by Savio D'Souza)

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MUMBAI, April 28 (Reuters) - India's REC RECM.NS has accepted bids worth an aggregate of 50 billion rupees ($587.5 million) for bonds maturing in 5 years and 1 month, and in 10 years and 1 month, three merchant bankers said on Monday.

The state-run company will pay an annual coupon of 6.87% and 6.86% on these issues, respectively, and had invited coupon and commitment bids for both earlier in the day, they said.

The company did not reply to a Reuters email seeking comment.

Here is the list of deals reported so far on April 28:

*Size includes base plus greenshoe for some issues

($1 = 85.1120 Indian rupees)

(Reporting by Khushi Malhotra; Editing by Varun H K)

(([email protected]))

MUMBAI, April 24 (Reuters) - India's REC RECM.NS plans to raise 60 billion rupees ($702.4 million), including a greenshoe option of 50 billion rupees, through sale of bonds maturing in five years and one month and in 10 years and one month, three merchant bankers said on Thursday.

The company has invited coupon and commitment bids from bankers and investors on Monday, they said.

REC did not reply to a Reuters email seeking comment.

Here is the list of deals reported so far on April 24:

*Size includes base plus greenshoe for some issues

($1 = 85.4200 Indian rupees)

(Reporting by Dharamraj Dhutia and Khushi Malhotra; Editing by Mrigank Dhaniwala)

(([email protected]))

Updates throughout

By Khushi Malhotra and Dharamraj Dhutia

MUMBAI, April 22 (Reuters) - At least six Indian state-run companies have sought government approval to issue deep-discount bonds, opting for a rarely used corporate bond structure to raise relatively cheaper funds, four sources aware of the matter said on Tuesday.

These companies are Indian Railway Finance Corp (IRFC) INID.NS, Indian Renewable Energy Development Agency (IREDA) INAR.NS, Power Grid Corp of India (PGC) PGRD.NS, REC RECM.NS, SIDBI and NABARD, the sources said.

REC has yet again sought permission to issue these bonds, after having raised 50 billion rupees ($587 million) similarly in September, when aggressive bids led to lower-than-expected yields.

REC confirmed the development but none of the other firms replied to Reuters emails seeking comment.

Deep-discount bonds are generally issued at a more than 20%-25% discount to their face value and do not pay regular interest, a feature similar to zero-coupon notes that removes reinvestment risks.

The surge in interest from companies to raise funds via these bonds is because they reduce overall borrowing costs in an environment when interest rates are seen falling further.

For investors, these bonds, though not tax-free, offer a significant long-term capital gains benefit. That, along with the rarity of such issues, is boosting demand for such notes, bankers said.

"At maturity, investors receive a profit which is taxable as per capital gains rates. This helps reduce the effective tax rate for investors making zero-coupon bonds attractive," said Nikhil Aggarwal, founder and CEO of online bond trading platform Grip Invest.

Last week, Housing and Urban Development Corp (HUDCO) HUDC.NS became the third state-run company to get approval to issue these bonds.

"HUDCO was the most likely candidate and they have got the approval and we expect REC and IRFC to be the next likely candidates," one of the sources said.

The sources said the government's approval may come in phases as they are not comfortable with a surge in the supply of zero-coupon bonds. The sources refused to be identified as they are not authorised to speak to the media.

HUDCO got approval to raise 50 billion rupees through bonds with a maturity of 10 years and one month, while Power Finance Corp (PFC) PWFC.NS was approved to raise 100 billion rupees in March. Both have until the end of March 2027 to raise these funds.

($1 = 85.1780 Indian rupees)

(Reporting by Khushi Malhotra and Dharamraj Dhutia; Editing by Savio D'Souza)

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MUMBAI, April 8 (Reuters) - India's REC RECM.NS has accepted bids worth an aggregate of 26.25 billion rupees ($305.4 million) for bonds maturing in 15 years, three merchant bankers said on Tuesday.

The company will pay an annual coupon of 7.02% and had invited coupon and commitment bids for both earlier in the day, they said.

REC did not reply to a Reuters email seeking comment.

Here is the list of deals reported so far on April 8:

*Size includes base plus greenshoe for some issues

($1 = 85.9650 Indian rupees)

(Reporting by Khushi Malhotra and Dharamraj Dhutia; Editing by Varun H K)

(([email protected]; [email protected]))

MUMBAI, April 7 (Reuters) - India's REC RECM.NS plans to raise 30 billion rupees ($349.5 million), which includes 25 billion rupees of a greenshoe option, through the sale of bonds maturing in 15 years, three merchant bankers said on Monday.

The state-run company has invited coupon and commitment bids from bankers and investors for the issue on Tuesday, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on April 7:

*Size includes base plus greenshoe for some issues

($1 = 85.8380 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Sumana Nandy)

(([email protected]))

March 21 (Reuters) - REC Limited RECM.NS:

• REC LIMITED - BOARD TO MEET ON MARCH 26 TO CONSIDER MARKET BORROWING PROGRAMME

Source text: ID:nBSE7hMcgw

Further company coverage: RECM.NS

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March 19 (Reuters) - REC Limited RECM.NS:

• REC - DIVIDEND 3.6 RUPEES PER SHARE

Source text: [ID:]

Further company coverage: RECM.NS

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MUMBAI, March 17 (Reuters) - India's REC RECM.NS has accepted bids worth an aggregate of 57.80 billion rupees (nearly $666 million) for the sale of bonds maturing in three years and in 10 years, three merchant bankers said on Monday.

The state-run company will pay an annual coupon of 7.44% and 7.32%, respectively, on these issues and had invited coupon and commitment bids for both earlier in the day, they said.

The company confirmed the details of the bond issue on an email.

Here is the list of deals reported so far on March 17:

*Size includes base plus greenshoe for some issues

($1 = 86.8050 Indian rupees)

(Reporting by Dharamraj Dhutia and Khushi Malhotra; Editing by Savio D'Souza)

(([email protected]))

MUMBAI, March 12 (Reuters) - India's REC RECM.NS plans to raise 60 billion rupees ($687.7 million), including a greenshoe option of 50 billion rupees, through the sale of bonds maturing in three years and 10 years, three merchant bankers said on Wednesday.

The state-run company has invited coupon and commitment bids for both the issues on Monday, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on March 12

*Size includes base plus greenshoe for some issues

($1 = 87.2420 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Sumana Nandy)

(([email protected]))

MUMBAI, Feb 25 (Reuters) - India's REC RECM.NS has accepted bids worth 19.95 billion rupees (nearly $229 million) for the sale of perpetual bonds, three merchant bankers said on Tuesday.

The state-run company will pay an annual coupon of 7.99% and had invited bids from bankers and investors earlier in the day, they said.

The bonds will have a call option at end of 10 years and every year thereafter, with the coupon rising by 50 basis points if the call option is not exercised at the end of the tenth year.

The company did not reply to a Reuters email seeking comment.

Here is the list of deals reported so far on February 25:

* Size includes base plus greenshoe for some issues

($1 = 87.1550 Indian rupees)

(Reporting by Dharamraj Dhutia and Khushi Malhotra; Editing by Savio D'Souza)

(([email protected]))

MUMBAI, Feb 20 (Reuters) - India's REC RECM.NS plans to raise 30 billion rupees ($346.42 million), including a greenshoe option of 25 billion rupees, through the sale of perpetual bonds, three merchant bankers said on Tuesday.

The state-run company has invited bids from bankers and investors on Tuesday, they said.

The bonds will have a call option at end of 10 years, and every year thereafter, and the coupon would be raised by 50 basis points if the call option is not exercised at the end of tenth year.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on February 20:

*Size includes base plus greenshoe for some issues

($1 = 86.5990 Indian rupees)

(Reporting by Dharamraj Dhutia and Khushi Malhotra; Editing by Janane Venkatraman)

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Feb 18 (Reuters) - Power Grid Corporation of India Ltd PGRD.NS:

• UNIT TRANSFERS ENTIRE SHARES OF KHAVDA V-BIB2 POWER TRANSMISSION TO POWER GRID CORP

Source text: ID:nBSE55YXKL

Further company coverage: PGRD.NS

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MUMBAI, Feb 11 (Reuters) - India's REC RECM.NS has accepted bids worth 52.80 billion rupees ($608.5 million) for bonds maturing in 15 years and seven days and for the reissue of February 2027 bonds, three merchant bankers said on Tuesday.

The state-run company will pay an annual coupon of 7.28% on the 15-year bond issue and a yield of 7.45% on the reissue, and had invited bids from bankers and investors earlier in the day, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on February 11:

* Size includes base plus greenshoe for some issues

($1 = 86.7725 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Savio D'Souza)

(([email protected]))

By Dharamraj Dhutia

MUMBAI, Feb 7 (Reuters) - Indian state-run companies are set to borrow nearly $2 billion via the bond market early next week after the central bank cut interest rates for the first time in nearly five years.

Four state-run firms REC RECM.NS, IIFCLIIFCL.UL, HUDCO HUDC.NS and SIDBI are looking to raise a total of up to 170 billion rupees ($1.94 billion) through Monday and Tuesday, according to merchant bankers.

Overall, companies raised around 125 billion rupees via bonds this week, compared with the typical weekly issuance range of 50-100 billion rupees.

The companies did not respond to Reuters emails seeking comments.

Earlier in the day, the Reserve Bank of India cut its key policy rate for the first time in nearly five years and signaled a less restrictive policy approach ahead to provide stimulus to the sluggish economy.

Governor Sanjay Malhotra also said the RBI will continue to monitor liquidity and financial market conditions and proactively take appropriate measures to ensure orderly liquidity conditions.

The central bank has already announced an infusion of close to 2 trillion rupees of durable banking system liquidity since the last month.

Bond yields rose after the policy decision as the central bank did not announce any additional liquidity measures along with the rate cut, which was already priced in.

"Market sentiment is expected to stabilise next week ahead of bidding," said Venkatakrishnan Srinivasan, founder and managing partner at debt advisory firm Rockfort Fincap.

Even as state-run companies generally prefer longer duration debt, of the total fundraising over the next two days, 110 billion rupees are being targeted through shorter duration debt.

"We expect robust demand from key investors such as provident funds, insurance companies, mutual funds, and banks for these issuances," said Suresh Darak, founder of Bondbazaar, an online bond trading platform.

Mutual funds have preferred to remain invested in shorter duration high-rated corporate bonds, as they anticipate more liquidity infusion bodes well for this part of the yield curve.

"The RBI also continues to remain comfortable on the domestic growth outlook. This indicates a shallow rate cut cycle ahead. Hence we continue to prefer short to medium duration products given the favourable risk reward," Anurag Mittal, head of fixed income at UTI Asset Management.

($1 = 87.4400 Indian rupees)

(Reporting by Dharamraj Dhutia;Editing by Saumyadeb Chakrabarty)

(([email protected];))

Feb 6 (Reuters) - REC Limited RECM.NS:

• REC DEC-QUARTER CONSOL NET PROFIT 40.76 BILLION RUPEES

• REC DEC-QUARTER CONSOL TOTAL REVENUE FROM OPERATIONS 142.72 BILLION RUPEES

• REC Dividend 4.30 Rupees Per Share

(([email protected];))

MUMBAI, Feb 5 (Reuters) - India's REC RECM.NS plans to raise 60 billion rupees ($686.11 million), which includes a greenshoe option of 50 billion rupees, through a sale of bonds maturing in 15 years and seven days and through reissue of February 2027 bonds, three merchant bankers said on Wednesday.

The state-run company has invited coupon and commitment bids from bankers and investors on Tuesday, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on Feb. 5:

*Size includes base plus greenshoe for some issues

($1 = 87.4500 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Varun H K)

(([email protected]))

Jan 20 (Reuters) - REC Limited RECM.NS:

• RAJASTHAN PART I POWER TRANSMISSION TRANSFERRED TO ADANI ENERGY SOLUTIONS

• CONSIDERATION INCLUDES 150 MILLION RUPEES PROFESSIONAL FEE, REIMBURSEMENT OF EXPENSES

Source text: ID:nBSE97Yqh6

Further company coverage: RECM.NS

(([email protected];;))

** Shares of Power Finance Corporation PWFC.NS and REC RECM.NS rise as much as 5.6% and 4.9%, respectively

** ICICI Securities resumes coverage on PWFC with "Buy" rating, TP of 550 rupees; initiates coverage of RECM with "Buy" rating, TP of 600 rupees

** Both public sector power financiers to lead the charge in India's energy transition funding, with Central Electricity Authority estimating about 43 trillion rupees ($496.8 bln) of capex towards generation and transmission by 2032 - ICICI Securities

** Brokerage says power financing sector has enough macro tailwinds for the ensuing years in which PWFC and RECM each have ~20% market share

** Sees loan CAGR of ~14% and ~17% over FY24–27 for PWFC and RECM, respectively

** In 2024, PWFC rose 17.2% while RECM gained 21.3%

($1 = 86.5625 Indian rupees)

(Reporting by Ashish Chandra in Bengaluru)

(([email protected] (+91 7982114624))

MUMBAI, Jan 13 (Reuters) - India's REC RECM.NS accepts bids worth 22.97 billion rupees ($265.61 million) for bonds maturing in 10 years, three merchant bankers said on Monday.

REC will pay an annual coupon of 7.20% on this issue and had invited coupon and commitment bids from bankers and investors earlier in the day, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on Jan. 13:

*Size includes base plus greenshoe for some issues

($1 = 86.4800 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Sherry Jacob-Phillips)

(([email protected]))

MUMBAI, Jan 9 (Reuters) - India's REC RECM.NS plans to raise 40 billion rupees ($465.92 million), including a greenshoe option of 33 billion rupees, through the sale of bonds maturing in 10 years, three merchant bankers said on Thursday.

REC has invited coupon and commitment bids from bankers and investors on Monday, they said.

The company did not immediately reply to a Reuters email seeking comment.

Here is the list of deals reported so far on Jan. 9:

*Size includes base plus greenshoe for some issues

($1 = 85.8510 Indian rupees)

(Reporting by Dharamraj Dhutia; Editing by Savio D'Souza)

(([email protected]))

** Shares of Power Finance Corporation PWFC.NS and REC RECM.NS rise as much as 3% and 3.6%, respectively

** Emkay Research initiates coverage on both these public sector power financiers with "Buy" rating

** Sets TP of 600 rupees for PWFC, premium of 30.6% over last close; TP of 650 rupees for RECM, premium of 25.4%

** Sees PWFC and RECM well placed to capture debt-funding opportunities as national electricity plan envisages 33 trln rupees ($384.8 bln) capex in the power sector ecosystem over FY23-32

** PWFC and RECM have significantly benefited from resolution of legacy NPAs, which combined with improving cash flows from thermal power plants, positions both cos for enhanced profitability - Emkay

** Sees ~13%/~18% AUM CAGR for PWFC/RECM over FY24-27, along with ~19%/~20% ROE during FY25-27

($1 = 85.7525 Indian rupees)

(Reporting by Ashish Chandra in Bengaluru)

(([email protected] (+91 7982114624))

MUMBAI, Dec 17 (Reuters) - India's REC RECM.NS has accepted bids worth an aggregate of 21.95 billion rupees ($258.50 million) for bonds maturing in 10 years and four months, and a reissue of the December 2039 bonds, three merchant bankers said on Tuesday.

REC has accepted bids worth 16.20 billion rupees on above 10-year bonds at a 7.10% coupon and bids of 5.75 billion rupees on a near 15-year bond reissue at a 7.1494% yield.

The state-run company invited bids from bankers and investors on Tuesday.

"Domestic bonds are integral to REC's broader strategic objectives and have proven to be a vital component of its financial strategy, offering a reliable and efficient means of raising substantial long-term funds," the company said in a statement.

Raising funds through domestic bonds is one of the major sources of REC's funding and is a regular activity, the company added.

Here is the list of deals reported so far on Dec. 17:

*Size includes base plus greenshoe for some issues

($1 = 84.9140 Indian rupees)

(Reporting by Dharamraj Dhutia
Editing by Abinaya Vijayaraghavan)

(([email protected]))