The bond yields of one of India s largest real estate players surged to around 73 per cent on Thursday. A surge in bond yields typically indicates financial stress.
The firm s dollar-denominated bonds with a coupon of 12 per cent are listed in Singapore. Sources said normally yields on a bond issued by a corporate surge when there s thin trading or a liquidity crisis.
The group, one of the largest realty players in Mumbai, is not listed on Indian stock exchanges.
The dollar bonds were issued by the group s subsidiary in two tranches with maturity in 2020. In the first tranche, the company raised $200 million and $ 125 mn in the second tranche.
In January 2019, the company had announced that it will buy back the bonds. The purpose of the purchase of the 2020 bonds is for the company to provide liquidity to the 2020 bond holders, proactively manage its capital structure and reduce gross debt and leverage, it had said in a statement in January.