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Business News/ Market / Stock-market-news/  NTPC tax-free bonds subscribed 11 times on day 1
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NTPC tax-free bonds subscribed 11 times on day 1

A total demand of over Rs4,400 crore was generated against the issue size of Rs700 crore

Ramesh Pathania/MintPremium
Ramesh Pathania/Mint

New Delhi: State-run NTPC Ltd’s 700-crore public issue of tax-free bonds was oversubscribed by 11.04 times on the first day of the opening of the issue. “By the end of day 1 i.e. by 5.00 pm the issue was oversubscribed by 11.04 times of the base issue size of 400 crore and 6.31 times of the overall issue size of 700 crore," the company said in a statement. The retail portion was oversubscribed by 6.60 times (of the total issue size allocated to retail), reflecting a huge confidence of retail investors in the company, it said.

A total demand of over 4,400 crore was generated against the issue size of 700 crore. NTPC’s issue was the first tax-free bond issuance in this fiscal, it said. Earlier in July, the government had approved the plan to raise 1,000 crore through tax-free bonds, including 700 crore through public issue.

NTPC was among seven state-run entities, including NHAI and IRFC, which were given permission to raise 40,000 crore in the current fiscal through tax-free bonds. “The 40% of the issue i.e. 280 crore is reserved for allocation to retail category. The remaining issue will be for non-retail investors including QIB, corporates and High Networth Indians," NTPC director (finance) K. Biswal had earlier said.

The issues has three tenures—10 years, 15 years and 20 years. For retail investors the coupon rate is 7.36% for 10 years tenure, 7.53% for 15 years and 7.62% for 20 years. Similarly for non-retail investors, the coupon rate is 7.11% for 10 years, 7.28% for 15 years and 7.37% for 20 years.

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Published: 24 Sep 2015, 12:49 AM IST
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