Housing and Urban Development Corporation (HUDCO) is planning to raise ₹500 crore, with an option to retain oversubscription of up to ₹2,500 crore through government of India’s fully-serviced, unsecured, redeemable, non-convertible, non-cumulative, taxable bonds in the nature of debentures.

The mode of issue of the 10-year bonds, which have a face value of ₹10 lakh per bond, is via private placement through online bidding process on electronic bidding platform (EBP).

As per HUDCO’s term sheet, the coupon rate will be notified at a later date. The minimum application size has been set at 10 bonds.

As per the objects of the issue, the funds will be utilised for augmenting the financial resources of the Ministry of Housing & Urban Affairs, Government of India, for implementing the Pradhan Mantri Awas Yojana (Urban).

Eligible investors in the bond issue will include Indian mutual funds, public financial institutions, scheduled commercial banks, State Industrial Development Corporations, insurance companies, provident funds, pension funds, gratuity funds, superannuation funds, national investment funds, insurance funds set up and managed by Army, Navy or Air Force, companies and bodies corporate, co-operative banks, regional rural banks, societies, and trusts authorised to invest in bonds/debentures.

FIIs

Further, foreign institutional investors and sub-accounts registered with SEBI or foreign portfolio investors (not being an individual or family office; and statutory corporations/ undertakings established by Central/ State legislature authorised to invest in bonds/debentures) can also invest in the bond issue.

The bonds, which are rated ‘AAA’ by India Ratings, CARE Ratings and ICRA, are proposed to be listed on the BSE. The principal and interest payments will be met by the government by making suitable provisions in the budget of the Ministry of Housing & Urban Affairs as and when the need arises.

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