SP Group unit expects completion of sale of two-year mega bonds by the end of January: bankers

India’s Goswami Infratech, part of the Shapoorji Pallonji Group (SP Group), will complete a bond issue before the end of January to refinance existing loans, three bankers aware of the matter said on Thursday. The real estate and civil engineering company is preparing to raise about 250 billion rupees ($2.84 billion) through a two-year zero-coupon bond issue, said the bankers, who could not be named as they are not authorized to speak to the media.

The money will be used to refinance the outstanding 88.15 billion rupees of high yield notes maturing in April 2026 and another loan, as well as for other debt-related and corporate purposes.

Goswami Infratech and Deutsche Bank did not respond to Reuters requests for comment.

The new issue will be underwritten by Shapoorji Pallonji Group’s 9.2% stake in Tata Sons, held through subsidiary Cyrus Investments.

Deutsche Bank, which arranged Goswami Infratech’s previous bond deal worth Rs 143 billion in June 2023, is also expected to lead this issuance. The company has already repaid more than a third of the previous bond, which had a coupon of 18.5%, according to Care Ratings. “The bookbuilding process is expected to be completed by mid-January, while the issuance will be completed by January-end,” one of the bankers said.

SP Group’s senior management is on a non-deal roadshow this week to update investors on recent business developments and gauge interest in what could be India’s largest ever corporate bond issue.

The group has approached newer investors to diversify sources of funding and is confident that the coupon for the current issue will be lower than that of the previous sale.

($1 = 88.5950 Indian Rupees)