"Such competitively priced instruments are the way forward in reducing the cost of financing and thereby the cost of energy in India." Mr. Sunil Jain, CEO of Hero Future Energies. (Source: Business Standard)
Hero Wind Energy Private Limited (HWEPL), part of the green energy venture of USD 5.6 billion of the Hero Group had commissioned 6 projects. The wind energy holding Company was looking at alternate solutions to refinance their existing debt and access new investor segments.TRUST, through its large distribution base expanded the Company's non-traditional investor base by placing the Bond issue with Mutual Funds and Non-Institutional investors. The transaction was met with high demand from investors, both domestic and foreign.
As the sole mandated lead arranger, TRUST facilitated the company towards their maiden bond issue of Rs. 300 cr.
In addition, to showcase the unique structure and the usage of funds, the bonds received a Climate Bond Certification which is the 1 st such transaction in India.
The financing has strengthened the Company's competitiveness, and the Group is now well positioned for further investments in the renewable energies area.
"This is a landmark issuance, being the first of its kind in the country at a competitive pricing. This shall pave way for more such issuances in future."
TRUST led and structured India's first Commercial Mortgage Backed Security (CMBS) issue for an amount of Rs. 900 crs for DLF Group, one of India's largest realty developer. The debt instruments were backed by rentals accruing from their two high-end luxury malls.
The transaction was efficiently structured to enhance the credit profile of the issue to AA (SO) by CRISIL. The rating was delinked from that of the parent company and linked solely to the lease rentals. This led to reduced cost of borrowing and creation of a wider investor base.
TRUST continues to pioneer new structures and deepen the Indian debt capital markets, while effectively managing the requirements of the issuer and the investor.
GSPC one of the leading oil and gas exploration, development and production companies in India, required to raise Rs. 3,000 crores through non-convertible debentures, for funding its capital expenditure and refinancing of existing loans.
TRUST through in-depth knowledge of the debt market, exhaustive penetration in long term investor segment and competitiveness was successful in helping this state level undertaking mobilize 85% of its fund requirements without any government guarantee. This was also a landmark deal in markets owing to the size of mobilization on firm commitment basis.
One third of these funds were raised through long-term bonds having maturity of 60 years. This long tenure transaction of Rs. 1000 crores was a first in Indian Debt Markets.
As the transaction was met by keen demand among investors, GSPC capitalised on the success, and went on to raise debt again within the next 6 months.
A large sized family office, which was generating surplus on a consistent basis, was primarily investing in short term MFs and FMPs to meet dual objectives of liquidity and returns, which were being partially met. Further, these investments were being made with a lot of difficulty given stringent covenants regarding diversification and quality of portfolio.
TRUST, through its discretionary Debt PMS platform, facilitated the client to take direct exposure to bonds and capitalise on several market opportunities. Through active management, the PMS added significant value and the portfolio is generating above-average returns on a consistent basis, while keeping the liquidity requirements in mind.
In a landmark deal, TRUST partnered with UP Corporation Limited (UPPCL), the holding company for Uttar Pradesh's five power distribution companies to raise funds and rebalance their debt under the UDAY Scheme launched by the Government of India.
TRUST was the first company to have won and receive the mandate for structuring and mobilizing bonds for UPPCL post announcement of UDAY scheme. We successfully executed the mandate for Rs. 99.99 billion NCD with a rating of AA(SO). The first issuance had an issue size of Rs. 65.1 billion, while the second tranche with a similar structure was executed for Rs. 34. 89 billion at 8.48% coupon payable quarterly.
This was a unique credit enhanced structure executed for the first time for a state level undertaking under the UDAY Scheme.
This also happens to be the first issue by a state level undertaking of such a large amount to be well distributed across various segments of investors.
With this, TRUST has set a new template for other state governments and power distribution companies to follow suit.
"It was the first ever retail bond issue from the entire Mahindra group. This will help strengthen our retail franchise as we see huge business potential in rural India. Besides, it helps to diversify our borrowing resources as well" - Ramesh Iyer, vice-chairman and MD, Mahindra Finance.
TRUST successfully lead managed Mahindra & Mahindra Financial Services Limited, one of India's leading NBFC's first ever public issue of bonds.
The issue size of the unsecured subordinated redeemable Non-Convertible Debentures (NCDs) was Rs. 1,000 crore and received a AAA rating. TRUST, through its large distribution base expanded Mahindra's investor base to include HNI and retail investors. The transaction was met with high demand from investors and the issue was oversubscribed 2 times on the very first day.
With the use of this long-term debt capital market financial instrument, the Company was able to ensure comfortable capital adequacy ratio along with diversification of the investor base.
To adhere with the Basel III Capital Regulations, Bank of India partnered with TRUST to issue India's first BASEL III compliant AT1 Perpetual NCD Bonds.
With expertise in creating and establishing markets for complex instruments, TRUST enabled the bank to shore up its capital base by Rs. 2,500 crores.
The instrument received wide acceptance and other nationalised banks soon started using these instruments for raising capital and adhering to the Basel III norms. Since then, TRUST has been a consistent partner with various banks to help them raise capital.
A Retirement Benefit Trust (RBT) client of a large listed corporate would call for quotes whenever it had surplus funds and would invest in the highest yielding bonds irrespective of maturity and ratings. No specific policies and no risk management was followed.
TRUST, once appointed as an advisor to the RBT, drafted an investment policy with specific risk guidelines to meet the desired return objectives. The portfolio had large amounts in G-Secs which was dragging the overall portfolio yield significantly. We advised the client to switch G-Secs with SDLs, which were yielding higher returns, and were equally safe.