Joint venture eyes four-tranche CCD issue amid rising investor interest in hybrid structures; SBI Capital Markets to arrange the ₹1,378 Cr deal.
IndianOil-Adani Gas Pvt Ltd, a joint venture between Indian Oil Corporation and Adani Total Gas, is set to raise up to ₹1,378 crore ($161 million) through compulsorily convertible debentures (CCDs) in what may become one of India’s biggest hybrid fundraises in 2024, after Adani Transmission’s ATL HVDC ₹900 crore CCD issuance earlier this year.
According to sources familiar with the matter, the deal will be structured across four tranches: three tranches of ₹350 crore each maturing in one, two, and three years, and a fourth ₹328 crore CCD maturing in four years. These CCDs will convert into equity at a future date, allowing the JV to raise capital without immediate dilution, a strategic move amid volatile equity markets and elevated interest rates.
🔹 Deal Size: ₹1,378 Cr via CCDs
🔹 Tenure: 1 to 4 years
🔹 Arranger: SBI Capital Markets
🔹 Conversion: Equity-linked (deferred dilution strategy)
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Why This Matters for Market Watchers
This CCD issuance highlights growing traction in convertible bond structures across Asia, with issuers leveraging them to tap capital while mitigating equity dilution. The IndianOil-Adani JV, which supplies piped natural gas (PNG) and compressed natural gas (CNG), is aligning its fundraising with India’s energy transition goals—targeting 15% gas share in energy mix by 2030.
In FY24, the JV reported a 23% rise in net income to ₹44.5 crore, though revenue dropped 14%. Crisil Ratings recently upgraded the firm’s long-term debt to AA-/Stable, citing scale-up, margin gains, and de-risked projects.
🔹 Stocks to Watch: Adani Total Gas, Indian Oil Corp, other city gas distribution players
🔹 Outlook: CCD issuance to drive valuation optimism; monitor Adani group capital moves
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