MUMBAI: Embassy Office Parks REIT in India is negotiating with bankers to secure 20 billion rupees ($232.79 million) by issuing five-year corporate bonds, according to three sources familiar with the situation, who asked to remain anonymous due to the private nature of the talks.
The firm aims to finalize this funding round by the end of the month. Mutual funds and some insurance companies are expected to show strong interest in the debt sale, as the bonds are rated ‘AAA’ by Crisil.
Embassy REIT will approach the bond market for the second time this year, following a successful raise of 7.50 billion rupees in June through the sale of 21-month bonds with a coupon rate of 6.9650%, paid quarterly.
One source noted, “Given the company’s aim for a larger amount compared to the June issuance, they opted for a longer tenor to appeal to insurance firms.” The specific coupon rate for this new bond has yet to be finalized.
Crisil’s ratings take into account the company’s exposure to refinancing risks and market volatility in the real estate sector, which can impact rental rates and occupancy levels.
Currently, the company has outstanding bonds totaling approximately 85 billion rupees, according to Crisil.
