Indian firms ready US$3 billion of debt issues with eye on potential RBI rate hike
The move comes ahead of the central bank’s October 7 monetary policy decision
Indian companies are preparing to issue about US$3 billion in rupee-denominated debt in the coming days, as they aim to secure borrowing costs ahead of a potential interest rate hike by the central bank. The monetary policy decision is scheduled for October 7. A total of 290 billion rupees (US$3.02 billion) worth of short- to long-term bond sales are being planned by large conglomerates, state-run firms, infrastructure investment trusts, and non-bank finance companies.
Prominent issuers include Reliance Industries, Vedanta, Delhi International Airport, Adani Airport Holdings, JSW Energy, Cube Highways Trust, Interise Trust, and India Infradebt, collectively seeking an aggregate 185 billion rupees. According to Akshay Naik, India head of debt capital markets at Citibank, issuers are locking in rates due to expectations of even higher rupee interest rates.
Market participants broadly anticipate the Reserve Bank of India will raise rates, marking the first hike since February 2023. The upcoming policy decision is influenced by signs of inflationary pressure in India and rate hikes by the US Federal Reserve, among other factors. Despite the looming rate hike, there is also significant liquidity available in the banking system to absorb the supply of bonds.
Written by urgent.news from The Business Times - Companies & Markets's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
