HDFC Bank raises $750 mn via bond sale; stock down
Private lender HDFC Bank Ltd stock was trading 0.42% lower on the bourses today after the bank announced it has raised $750 million through a dollar bond sale. The HDFC Bank stock opened at ₹1,619.35 but soon fell to an intra-day low of ₹1,590.15 on the BSE. At the current share price, HDFC Bank's market cap stands at ₹8,90,561.45 crore.
“HDFC Bank Limited acting through GIFT City IFSC Banking Unit has completed the issue of 750 Million US$ Senior Unsecured Bonds," said HDFC Bank in its regulatory filing.
HDFC Bank said the proceeds of funds raised will be utilised for "banking activities". The USD-denominated senior unsecured notes are rated Baa3 by Moody’s Rating Services and BBB- by S&P, said India's largest private sector bank in terms of m-cap. The notes will be listed on the India International Exchange (IFSC) Ltd and the tenure of the instrument is fixed at 3 years -- settlement on March 2, 2023, and maturity on March 2, 2026.
HDFC Bank said it'll be paying interest of 5.686% on it. HDFC's dollar bond sale follows its parent HDFC's announcements last week, wherein it submitted a term sheet on February 14, 2023, for the issue of Secured Redeemable Non-convertible Debentures (NCDs) worth Rs 5,000 crore, with an option to retain over subscription of ₹20,000 crore under Series AB-002.
The corporation, which is in the process of merging itself with HDFC Bank, received 92 bids worth ₹27,863 crore for the NCDs on the Electronic Bidding Platform (EBP) and accordingly it accepted 55 bids for the said NCDs issue aggregating ₹25,000 crore (including the option to retain oversubscription of ₹20,000 crore) at a coupon rate of 7.97% per annum, payable yearly. The NCDs were allotted on February 17, 2023.
The object of the issue is to augment the long-term resources of the corporation. The company said the proceeds will be used for financing or refinancing its housing finance business.
For the third quarter that ended December 31, 2022, HDFC Bank posted a 19.9% year-on-year (YoY) growth in consolidated net profit to ₹12,698 crore on the back of strong improvement in interest income as well as lower provisions. The net interest income (NII) climbed 25% YoY to ₹22,987.8 crore, supported by a rise in lending rates following RBI’s interest rate hikes.
HDFC reported a standalone profit of ₹3,691 crore, reporting 13% growth over ₹3,261 crore profit in the corresponding quarter of the previous year. The company's revenue surged to ₹15,246.81 crore in Q3 FY23, up 29% as compared to ₹11,792.21 crore in the year-ago period. Its Q3 NII stood at ₹4,840 crore as compared to ₹4,284 crore in the previous year, registering a growth of 13%.