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According to the most recent information, when BSNL issued Government Guaranteed Bonds, investors reacted favourably.

BSNL raised Rs 8500 Crore through government-guaranteed sovereign bonds.

Today, on a private placement basis, Bharat Sanchar Nigam Limited (BSNL) issued Government Guaranteed Bonds with a 10-year maturity. Investors responded to the Bond in a resoundingly positive manner.

With a base issue size of Rs 1000 crore and the option to retain oversubscription up to Rs 7500 crore, BSNL offered Government Guaranteed Unsecured, Redeemable, Listed, Taxable, Non-Convertible Debentures with face values of Rs 10 lakh each at par on a private placement basis through BSE’s Electronic Bidding Platform (EBP).

The ratings given to the Bonds are “BWR AAA(CE)/Stable” by Brickwork India Rating Limited, “CARE AAA(CE)/Stable” by CARE Ratings Limited, and “CRISIL AAA(CE)/Stable” by CRISIL Limited. Instruments with this grade are regarded as having the lowest credit risk and the highest degree of safety in terms of prompt payment of financial obligations.

The bidding through BSE EBP was held on Monday, the 21st of September 2020 between 10:30 AM and 12:00 Noon. At the close of bidding, bids worth Rs 17,183.10 Crore were received from 229 investors. The issue was subscribed over 2.02 times of the total issue size and is the largest Government Guaranteed Bonds issue in recent times, which received such an overwhelming response. The coupon rate too is also best in comparison to other similar offerings in recent times.

According to Sri P K Purwar, CMD of BSNL, BSNL Management has decided to sustain the whole subscription of Rs 8500 Crores at a coupon rate of Rs 6.79%. These bonds will soon be listed on the BSE and used to restructure debt and meet BSNL’s CAPEX needs. All investors, including banks (HDFC Bank, ICICI Bank, Axis Bank, State Bank of India, ICICI, Punjab National Bank), mutual funds, pension funds, rural postal life insurance, etc., he claimed, have a high level of confidence in the publicly traded telecom service provider (BSNL), according to the responses from investors.

The Cabinet approved the BSNL Revival package in October 2019, which also includes the distribution of 4G spectrum, the funding of Rs 8500 crores in Government Guaranteed Bonds, VRS to staff over 50, and the merging of MTNL and BSNL.

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Written by Shallu Srivastav

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