Five banks to lead NTPC’s debut masala bond offering

Barclays, Citigroup, Deutsche Bank, HSBC and SBI Capital Markets are being tipped to lead NTPC’s debut issuance of offshore rupee-linked bonds.

Although an official mandate had yet to be awarded, the banks had received the word of NTPC’s decision, sources aware of the matter told IFR.

The five lenders also led NTPC’s US dollar offering last November, when it raised $500 million through a 10-year Reg S-only bond priced to yield 205bp over Treasuries.

IFR reported earlier that NTPC planned to raise $1 billion from the offshore dollar market in the current financial year.

NTPC, the country’s largest power company, is among a handful of Indian companies waiting to raise funds through this new market once the Reserve Bank of India finalises guidelines on such issues.

The offshore notes, also called masala bonds, will be issued under India’s external commercial borrowing guidelines.

Earlier this month, the Reserve Bank of India had issued draft guidelines on masala bonds, but had yet to come out with the final rules.

According to sources, the central bank is awaiting clarification from the finance ministry over taxation issues on such bonds.

So far, only the Asian Development Bank and the International Finance Corp, an arm of the World Bank, had issued Masala debt last year, allowing investors to access rupee debt outside India.

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