With an aim to refinance a part of its rupee debt, JSW Steel has raised USD 500 million (about Rs 3,000 crore) through a bond sale to overseas investors, market sources have said.
With a tenure of five years, the bonds carry a coupon rate of 4.75 per cent. The proceeds would be used for repayment of outstanding rupee term loans which had been borrowed for capital expenditure purposes.
"The issue was oversubscribed," said market sources, adding that these would be listed in Singapore Stock Exchange.
Citigroup Global Markets Singapore Pte, Australia and New Zealand Banking Group, Credit Suisse Securities (Europe), Deutsche Bank AG, Singapore Branch and Standard Chartered Bank were the joint lead managers for the offering.
Yesterday, the company had informed BSE that its Board of Directors have given its nod to launch the issue for raising upto USD 500 million.
JSW Steel has Rs 35,750 crore net debt out of which 35 per cent is in foreign currency.
The company was assigned Ba 1 rating with stable outlook by Moody's and BB+ rating with stable outlook by Fitch.
Moody's said JSW Steel's Ba1 rating reflects its large scale and competitive conversion costs and its track record of managing growth, both organic and by acquisition, while at the same time controlling consolidated leverage to moderate levels relative to its steel industry peers.
Fitch assigned JSW Steel a senior unsecured rating of 'BB+' and the company's proposed US dollar denominated notes an expected rating of 'BB+'.
Fitch said JSW Steel benefits from its low cost base due to its low conversion costs. It's efficient operations were reflected in its strong profitability, with EBITDA margin of 17.9 per cent in FY'14.
The rating agency expects JSW Steel's profitability to remain strong over the medium term because it would continue initiatives to reduce costs.
Shares of JSW Steel fell 1.18 per cent to end at Rs 1,214.40 apiece on the BSE today.
