State Bank of India (SBI), the country's largest lender, raised Rs. 10,000 crores today at a coupon rate of 7.49% through its fourth infrastructure bond issuance. The issue attracted overwhelming response from investors with bids of Rs. 21045.10 crores and was oversubscribed by more than 5 times against the base issue size of Rs. 4,000 crores. The total number of bids received was 134 indicating wider participation with heterogeneity of bids. The investors were across provident funds, pension funds, insurance companies, mutual funds, corporates etc. The proceeds of bonds will be utilized in enhancing long term resources for funding infrastructure and affordable housing segment.
Based on the response, the Bank has decided to accept Rs. 10,000 crores at a coupon rate of 7.49% payable annually. This represents spread of 12 bps over the corresponding FBIL G-Sec par curve. Prior to this, the Bank had raised Long Term Bonds of Rs. 10,000 crores on 1st August 2023 at a spread of 13 bps over corresponding FBIL G-Sec par curve. The Bank has AAA credit rating with stable outlook from all domestic credit rating agencies for these instruments. With the current issuance, the total outstanding Long-Term Bonds issued by the Bank is at Rs. 39,718 crores.
This issuance is also very significant as the Bank has been successful in raising long duration bonds successively at a finer spread. We believe that this issuance may help in developing a long term bond curve and encourage other banks to issue bonds of longer tenor.
Shares of State Bank of India was last trading in BSE at Rs. 598.10 as compared to the previous close of Rs. 588.30. The total number of shares traded during the day was 866541 in over 16677 trades.
The stock hit an intraday high of Rs. 602.00 and intraday low of 592.00. The net turnover during the day was Rs. 518389506.00. |
