Lodha Group subsidiary announces buy-back for 2020 dollar-denominated bonds

January 22, 2019

MUMBAI: Lodha Developers International, a subsidiary of India’s largest realty developer Lodha Group, has announced a buy-back programme for its senior dollar denominated bonds, which are due in the year 2020.

The company has appointed J.P. Morgan Securities PLC to repurchase up to $65 million or 20% of the $325 million outstanding bonds with 12% coupon listed on Singapore Stock Exchange (SGX), the company said in a release.

The buyback of these senior notes will be financed by the company from its currently available funds.

“The purpose of the purchase of the 2020 Bonds is for the company to provide liquidity to the 2020 Bondholders, proactively manage its capital structure and reduce gross debt and leverage,” the release said.

It is expected that the bond repurchase arrangements will start from today. In accordance with the terms and conditions of the 2020 Bonds, the purchased 2020 Bonds may either be cancelled or held until their maturity date.

Lodha Developers International had issued the dollar bonds in two tranches. In the first tranche, the company had raised $200 million at 12% coupon rate in 2015-16 and the second tranche of $125 million at 8.9% coupon was raised in late 2017.

According to the company, its consolidated debt stands at Rs 18,000 crore as on end of January 2018. The developer clocked sales of Rs 4,200 crore during April-September, while sales collection from customers was Rs 5,000 crore during the period.

Last year, Lodha Developers filed its draft red herring prospectus to raise funds around Rs 5,500 crore through its Initial Public Offer (IPO). The company received capital market regulator Securities & Exchange Board of India’s (SEBI) approval for the IPO in July. However, the issue has been deferred in the backdrop of weak market conditions.