Aviation News

GMR Airports plans Rs 1,950-cr debt raise at over 13% yield, Infra News, ET Infra


MUMBAI: GMR Airports Holdings is looking to raise ₹1,950 crore through a high-yield debt offering at a coupon rate of 13.275% with a tenor of three years.

Credit Solutions India Trust has committed ₹500 crore as the anchor investor for this offering, people aware of the development said.

The coupon rate includes a 5% cash coupon and an 8.275% redemption premium paid annually. Care Ratings has assigned an ‘A-‘ rating to the issue, and the subscription book is scheduled to open on November 20.

“GMR is paying higher coupons because it is borrowing money at the holding company,” one of the sources said.

Last week, GMR Goa Airport had raised funds at 10%, as reported.

A GMR spokesperson did not immediately respond to queries.

GMR Airports Holdings, the parent company of Delhi International Airport Ltd (DIAL) and GMR Hyderabad International Airport Ltd (GHIAL), is looking to use the funds raised for refinancing its outstanding non-convertible bonds (NCBs). Additional proceeds will be directed towards investments and potential stake purchases in subsidiaries, sources said.

The company is in the process of refinancing NCBs amounting to ₹5,000 crore, as per a Care Ratings report.

Despite witnessing robust growth in passenger traffic at DIAL and GHIAL, the company faces debt-related challenges and GAL, the holding entity, is reliant on “debt-funded equity investments” due to limited upstreaming of cash flows from operational subsidiaries, the rating report said.

The company’s outstanding NCBs, including accrued interest, stood at ₹3,906 crore as of September 30, 2023, with a significant redemption due in December 2023, the report said.

GAL is engaged in under-implementation projects, exposing it to project-related risks, including the construction of greenfield projects in Andhra Pradesh and Greece.

  • Published On Nov 20, 2023 at 05:02 PM IST

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