Singapore equity issue

The Australian and New Zealand bond markets took on new global significance in 2014, as a growing number of international issuers turned to an expanding local investor base in search of alternative sources of funding. Australia and New Zealand Banking Group was at the forefront of this trend, leading Australian dollar issuance and doing more than any other arranger to connect international issuers with Australasian investors. Benefiting from its offices in Dubai and Abu Dhabi, it was a joint bookrunner on all four of 2014’s Kangaroo issues from the Middle East as National Bank of Abu Dhabi, First Gulf and Emirates NBD and Abu Dhabi Commercial raised a combined A$1.3bn – the latter three all being debut issuers. Paul White, ANZ’s global head of debt syndicate, said such deals offered diversification, as well as volume, for overseas issuers, with levels at the five-year maturity similar to or inside other major markets. Investors, meanwhile, got an attractive yield relative to similarly rated local financials. Other standout debutants in the Kangaroo market in 2014 include ABN Amro’s January 28 A$500m debut, also the first deal of the year outside the sovereign and agency sector. ANZ was the only domestic bank on the dual-tranche five-year bond from the Dutch commercial bank. ANZ also helped arrange Korea National Oil Corp’s A$350m Kangaroo debut in September, and was the only local lead manager to work on all three Kangaroo bonds from South Korean banks. Arguably even more significant was September’s ground-breaking debut from Anglo-Swiss mining giant Glencore, with a A$500m five-year bond that gave Australia’s underdeveloped corporate bond market a welcome shot in the arm. Crucially, Glencore passed the local participation test as Australian investors took 67% of the offering, underlining the country’s growing appeal as a key funding alternative for global companies. ANZ was a joint lead on the deal, which became the second biggest of the 39 corporate bonds printed in Australia during the awards period, and was rewarded with a role on Total’s debut Kangaroo offering in November. The bank ranks No 1 on the league table for all Australian dollar issues in the review period with an even 100 trades, totalling almost A$20bn (US$17.4bn), and remains a big player in the local securitisation market, taking part in 13 asset-backed transactions during this time. It was similar story across the Tasman Sea, where overseas issuers raised a record NZ$6bn (US$4.65bn). ANZ was lead manager on 15 of the 25 Kauri tickets – the most of any bank – and led 18 of the 28 domestic New Zealand dollar bonds during the year. To see the digital version of this report, please click here.

Goldman Sachs made its mark in Australasian equities in 2014 with leading roles on Australia’s largest IPO, rights issue, institutional placement and block trade. The bank has honed its local platform and made multiple personnel changes since taking full control of its JB Were joint venture in 2011, and those investments paid off in a year when Australian equity raising continued to rebound, while IPOs gathered pace. Notably, Goldman used its ability to take risk to lure top-tier clients away from its main competitors. Toll-road operator Transurban Group’s A$2.34bn (US$2.0bn) entitlement offer underlined Goldman’s ability to put its balance sheet on the line for the right deal, and the right client. The bank signed a nerve-inducing 30-day hard underwriting agreement with very limited termination events, ensuring that Transurban would have the money it needed to acquire Queensland Motorways under any circumstances, without requiring a bridge facility. Goldman and another bookrunner, originally pitched the 10-for-43 offer at a 6%–8% discount to Transurban’s TERP, and managed to price the deal tighter at a final discount of 5.8%. In June, Goldman underwrote another jumbo deal after beating three other rivals in a competitive bid. Together with one other bank, Goldman underwrote Royal Dutch Shell’s A$3.24bn block sale in oil-and-gas exploration company Woodside Petroleum, the largest secondary block trade in Asia since December 2012. A sole-led A$650m equity placement for QBE Insurance Group also demonstrated how Goldman could tailor-make capital market solutions for clients in accordance with their developments. QBE needed a comprehensive capital plan in August to improve its financial flexibility, and Goldman used an innovative capped bookbuilding process to allow existing shareholders to avoid dilution. Investors willing to bid at the top of the A$9.85–$10.10 price range were guaranteed at least their pro-rata allocations. That strategy helped the placement price at the top, and squeezed out hedge funds that just wanted to flip the stock. QBE’s stock rose 5.6% the day after the placement. Goldman was also joint bookrunner on the A$2.3bn IPO of Healthscope, Australia’s second largest private hospital operator. That was the country’s largest new listing under IFR’s review period, although Medibank Private, another Goldman mandate, will take that title for the calendar year. In New Zealand, Goldman helped the government raise NZ$365m (US$289m) through the sale of a 20% stake in Air New Zealand in November 2013. It also solely arranged Commonwealth Bank of Australia’s NZ$92m selldown in Kiwi Income Property Trust in January. To see the digital version of this report, please click here.

Japan takes over With 2015 looming large on the horizon, it is Japan that has Asia’s foreign-exchange markets on tenterhooks. US monetary policy, so long the key to global market liquidity, is playing second fiddle. The US Federal Reserve ended its massive six-year stimulus programme in October without much ruckus. The central bank had already prepared investors for this in July, seven months after it first started trimming its bond-purchase programme, which, at the peak, had pumped US$85bn a month into the global financial system. Fed minutes for the October meeting show little debate or dissent among policymakers as the US economy pushed ahead with above-trend 3.5% annualised growth in the third quarter, while churning out the best job gains in years. In October, the US jobless rate eased to 5.8%, its lowest in over six years, in a continued retreat from the near 10% figures in the wake of the global financial crisis. The US economy has emerged as the star in the advanced world. Yet, the Fed has promised to hold its short-term interest rate near zero for now as falling gasoline prices keeps inflation below the 2% target, and most economists expect the central bank to wait until the middle of 2015 before lifting interest rates. For now, the Bank of Japan’s expanded stimulus is filling the void the Fed has left, while the European Central Bank is also promising to pump more money into the euro bloc if current measures fall short. The US dollar’s strength, especially against the G10 currencies, remains Goldman Sachs’ strongest asset market view for 2015, alongside continued declines in the euro and further meaningful yen weakness. While expectations of a strong dollar are widely held, with forward markets pricing in a significant widening in US policy rates versus others, Goldman Sachs has noted there is still scope for rate differentials to widen, even versus the forward pricing. The bigger story is the dollar’s multi-year recovery, according to the bank’s analysts, who have recommended clients adopt more ambitious dollar positions. Stephen Jen from SLJ Macro Partners has also argued that the current environment is very positive for the dollar, as it is the first time since 2009 that the Fed has pledged to keep rates low for longer in response to a positive supply shock rather than a negative demand shock, and both the near-0% policy rate countries and those facing high and rising household leverage will prefer to keep their own currencies weaker. However, Jen has warned that the yen-weakening story could overshadow the dollar’s strengthening. “The US dollar’s strength, especially against the G10 currencies, remains Goldman Sachs’ strongest asset market view for 2015, alongside continued declines in the euro and further meaningful yen weakness.” While Fed policy had been the wild card for most of the last two years, the tables turned when the BOJ pulled its huge Halloween surprise. Less than 24 hours after the Fed announced the end to quantitative easing, the BOJ said that it would boost Japanese Government bond purchases by ¥30trn (US$255bn) to an annual pace of ¥80trn and triple its purchases of exchange-traded funds and real-estate investment trusts. On the same day, Japan’s US$1.2trn public pension fund – the world’s largest – announced that it was to increase holdings of foreign stocks to 25% of its portfolio from 12%, pouring around US$187bn into worldwide stock markets in the process. Meanwhile, Prime Minister Shinzo Abe has pledged to postpone a planned second increase in the sales tax if he wins the December 14 snap election.Even weaker yen News that Japan’s economy had entered a triple-dip recession in the third quarter provided solid rationale for the recent policy moves. A continuous stream of poor Japanese data will only increase pressure on Abe and Kuroda to pull out all the stops to get the economy going again. The yen is now hovering at more than seven-year lows after falling over 10% since the start of the yea

In a mature market where the four major domestic banks were dominant, National Australia Bank stood out from its peers in 2014, thanks largely to a reshuffle of its debt markets team that broadened its product offerings. Under the leadership of Steve Lambert, executive general manager of NAB’s debt markets division, the bank rolled out a client-focused structure in 2013, bringing together loan and bond specialists in a single team. While common in global banks, the set-up is unique in Australia, and allowed NAB to originate and execute across all debt products in 2014. “This is a product-agnostic structure, not a ‘product-siloed’ team, which has an advantage from an execution standpoint,” said Stephen Boyd, head of corporate debt markets origination. NAB led several significant deals during IFR’s review period, including a A$400m (US$340m) syndicated bank guarantee for supermarket chain Woolworths that showcased its newly combined platform. As one of two bookrunners, NAB helped devise a unique structure that allowed the company to use its funding lines more efficiently in issuing WorkCover bank guarantees that transferred the risk from banks to insurance firms. WorkCover is a statutory insurance scheme for workers’ compensation in Australia. The bookrunners tapped offshore insurance firms to create a new universe of investors for Woolworths, which, in turn, freed up credit lines for its banks. The order book was 3.75 times oversubscribed. The structure was a first for an Australian borrower and could be copied by other borrowers that need guarantees to meet liabilities to third parties. Another notable success came with the jointly underwritten A$2.9bn loan backing a Transurban-led consortium’s winning bid to acquire a portfolio of toll roads from Queensland Motorways. The deal was oversubscribed and nine lenders joined in general syndication. The financing package also included a A$1bn two-year bridge loan that the four underwriters – ANZ, CBA, NAB and Westpac Banking Corp – held jointly. Across the Tasman Sea, NAB’s Bank of New Zealand also has a strong franchise and underwrote several transactions on a sole basis, including a NZ$500m (US$392m) standby facility for Auckland Council. It was the first New Zealand facility with a term-out option, with a one-year maturity and an option to extend the loan for another year. The bank also underwrote a NZ$165m revolving credit for mobile operator Two Degrees, New Zealand’s third-largest mobile operator. Despite the aversion of the major banks to mobile operators, a legacy from the collapse of OneTel in Australia, the deal was oversubscribed with a number of Asian lenders participating. To see the digital version of this report, please click here.

China continued to promote the capital markets as an alternative to bank lending in 2014, and Bank of China Group led the charge, scoring landmark deals in both the offshore and onshore markets. Onshore, BOC, one of China’s Big Four commercial banks, became a top player in the domestic interbank market during IFR’s review period, helping to raise more than Rmb275bn (US$44.7bn) for its clients from around 250 deals, representing a market share of 10.5%. Offshore, the group executed 45 G3 and 37 offshore renminbi transactions, showing its strength in bringing its mainland clients to the international capital markets. BOC International, the group’s main offshore investment banking arm, consistently ranked in the top five among all underwriters on the major bond league tables. It was No 1 in G3 currency bond issuance for Chinese investment-grade corporations, and No 2 in Dim Sum, where it was the top-performing PRC bank. BOC (Hong Kong) played its part in the world’s biggest Dim Sum market, while other overseas branches made their mark with offshore renminbi issues in their respective jurisdictions, helping drive the group’s expansion – and the Chinese currency – beyond the country’s borders. The group kept on playing a key role in the internationalisation of the renminbi, bringing several new issuers to market and launching landmark bonds in several offshore centres, including the UK’s sovereign issue – the first Dim Sum bond from a foreign government. It was the only Chinese bank to participate in all five of the largest overseas senior bonds from the state-owned sector, working with the likes of CNOOC, Sinopec and State Grid. It was also global co-ordinator on three of the four overseas bonds from China’s asset-management corporations, among the first out of an industry that is transitioning from a policy role to a commercial mandate. BOC was also able to help its clients take advantage of some of the latest financial reforms in the PRC. One example was assisting property developer Greenland in bringing the first US dollar issue, under a new cross-border guarantee scheme, to raise US$1bn in June. The group’s two most significant offshore bonds of 2014 were both self-led transactions, but there was nothing routine about the two bank capital issues. The BOC US$6.5bn preference share offering in October was the world’s largest Additional Tier 1 deal, despite being the first of its kind out of China. Weeks later, a US$3bn 10-year non call five bond became the largest Basel III-compliant Tier 2 issue from Asia, ex-Japan. The record-breaking deals scotched fears that China’s banks would struggle to manage the transition to new Basel standards, and set an important benchmark for others to follow. To see the digital version of this report, please click here.

With domestic markets still in a state of flux and the pipeline for public sector offerings shrinking, Credit Suisse’s ability to market China’s emerging private-sector champions to international investors saw it stand out from the competition. Chinese technology companies were especially active in 2014, and Credit Suisse’s sector expertise came to the fore as internet stocks emerged as the leading drivers of Chinese equity capital markets. Credit Suisse added to its reputation as a technology sector powerhouse with a key role on the record-breaking Alibaba Group IPO, and led many other US equity offerings for companies in the sector. “Credit Suisse has always been strong in the tech sector, and that competitive strength has put us in a very favourable position for this wave of tech fundraising,” said Mervyn Chow, head of global markets solutions group in Asia Pacific at Credit Suisse. The US$25bn New York Stock Exchange listing of Alibaba, the world’s largest IPO, was an unqualified success, and Credit Suisse was one of the only two banks involved in drafting the IPO prospectus, having started working on the deal years earlier. The bank has led seven offshore M&A and financing transactions for Alibaba since 2012, and its role as the sole arranger of the directed share programme, and one of the two agents responsible for releasing lock-up contracts, underlined the strength of its leading relationship with the group. While five other banks can claim bookrunner status on that deal, Credit Suisse stood out in 2014 for the depth of its China coverage, bringing 11 other tech IPOs in the year, including the US$280m NYSE IPO of Beijing-based online cosmetics retailer Jumei International and the US$328m Nasdaq IPO of Weibo, the biggest Twitter-like microblogging service in the PRC. The bank was also exceptionally strong in the equity-linked segment. It was one of the two bookrunners for the US$1.03bn convertible bond of software developer Qihoo 360 Technology in August, the largest such offering from an Asian issuer in four years. While dominating US-listed fundraisings, Credit Suisse also proved it could play in the Asian equity markets, with several sizable Hong Kong IPOs of Chinese SOEs under its belt during the review period. It was joint sponsor on the US$2.8bn listing of China Cinda Asset Management, the joint bookrunner of the US$1.3bn IPO of China CNR Corp and the joint global co-ordinator of the US$1.1bn float of Harbin Bank. Credit Suisse’s leading role on every big tech deal put the bank in second spot on IFR’s China equity and equity-linked league table in the 12 months through mid-November. The bank raised US$9.08bn for Chinese issuers through 42 deals. To see the digital version of this report, please click here.

The renminbi’s global march entered a new phase in 2014 after some volatile trading squeezed out currency speculators, but HSBC’s dominance remained intact throughout the year. HSBC executed more landmark transactions across products, sectors and geographies than any other bank in the offshore renminbi market. It registered up a market share of over 25%, having led 93 of the 249 issues, excluding CDs, during IFR’s review period and handled around 1.58 times the volume of its closest competitor. The bank also pioneered new initiatives and was involved in the most ground-breaking transactions, helping issuers tap new pools of renminbi liquidity. The highest-profile Dim Sum in 2014 was the Rmb3bn (US$490m) three-year bond from the United Kingdom, which made it the first foreign country to issue offshore renminbi bonds and helped accelerate activity in the currency in Europe. A few weeks later, HSBC helped the Canadian Province of British Columbia secure improved terms on its second Dim Sum bond, increasing the size to Rmb3bn and the tenor to two years. Notably, 56% of the BC bonds went to investors outside Asia, while the participation of central banks and official investors advanced to 54%. Both were highs in the history of the offshore renminbi market. HSBC led flagship deals in all the rising offshore renminbi hubs, with landmark deals like the Rmb2bn issue of Bank of China, Paris branch, the Rmb1.25bn Swiss-listed issue CCB Asia, the Rmb4bn Singapore- and Taiwan-listed issue of ICBC and the Rmb1.5bn MyClear-listed issue of Cagamas. Those deals not only set records in many jurisdictions, but also created benchmarks for the wider industry to follow. HSBC remained the bookrunner of choice for international borrowers during IFR’s review period, with repeat mandates from New Zealand’s Fonterra, global consumer giant Unilever and seasoned supranational issuers IFC, Asian Development Bank and Central American Bank of Economic Integration. Another achievement was the first Green bond in renminbi, with an issue from International Finance Corp. While investment-grade issues dominated in 2014, HSBC showed off its structuring capabilities, too, with a sizable haul of high-yield and bank capital mandates. On the high-yield front, HSBC led 10 of 18 issues for total volume of Rmb22bn. Among the high-yield deals, HSBC demonstrated its structuring capabilities in designing a unique security package for two fundraisings for Lai Sun Group companies eSun Holdings in June and Lai Sun Garment in July for a joint project in Hengqin, adjacent to Macau. To see the digital version of this report, please click here.

HSBC stood head and shoulders above its peers in Hong Kong’s syndicated loans market in 2014, leading borrowings for blue-chip companies and playing prominent roles on jumbo event-driven financings. It topped the bookrunner league tables in IFR Asia’s review period, notching up US$4.22bn across 31 deals for an 8% share of a well-banked market, showcasing both the bank’s structuring capabilities and the depth of its corporate relationships. HSBC kicked off the review period with a sole mandate on a HK$10bn (US$1.29bn) dual-tranche acquisition loan for CLP Holdings. HSBC underwrote the whole deal, which was split equally into a 12-month bilateral bridge and a two-year revolving credit, and attracted a dozen lenders when it was signed in January. The bank was also the sole underwriter on the city’s only leveraged buyout loan – a US$75m financing that funded CVC Capital Partners’ acquisition of a majority stake in The Executive Centre, a provider of premium serviced offices. HSBC also jointly led a HK$37.5bn three-year term loan backing Hong Kong conglomerate Hutchison Whampoa’s utility company Power Assets Holdings’ spin-off of Hongkong Electric and also lent HK$10bn to finance State Grid Corp of China’s cornerstone investment in HKE’s IPO. The bank’s ability to play leadership roles on top-heavy club loans showed through in a US$3.2bn dual-tranche facility for Cofco Corp, which funded the acquisition of a 51% stake in Nidera in the largest purchase in the Asia Pacific food sector. With HSBC as sole coordinator, 11 others joined the loan. The bank had a similar role on a HK$3.85bn club facility for K Wah International in September. HSBC also had sole co-ordinator roles on several major transactions for Chinese securities firms. These included a HK$3.3bn loan for Guotai Junan International Holdings in January, a US$300m financing for ICBC Financial Leasing in April, which was the company’s debut offshore syndicated loan and set a new benchmark for China’s leasing sector, a HK$3.34bn deal for Haitong International Securities Group in May, a US$150m facility for KGI International Holdings in June and a US$150m loan for UniTrust Finance & Leasing Corp launched in October. Property firms remained important to the Hong Kong market and HSBC was again in the top group for a HK$14bn 5.5-year loan for Sun Hung Kai Properties and HK$13.8bn dual-tranche facility for Henderson Land Development, both of which closed in January. A close relationship with Henderson also helped HSBC play a role behind the scenes on IFC Development’s HK$10bn five-year refinancing, which was doubled from an original size in August. To see the digital version of this report, please click here.

The HK$6.8bn (US$878m) listing of China’s Luye Pharma Group was the closest anyone came to a flawless Hong Kong IPO in 2014. Luye achieved an attractive valuation that left something on the table for investors, built a high-quality shareholders’ roster and more than justified its decision to switch from Singapore two years earlier. At a time when most Hong Kong IPOs risked confusing investors with an overcrowded syndicate, Luye’s float also showed that a sizable deal can be neatly executed with only three banks. Luye, which boasts a diverse range of traditional and Chinese medicines, delisted from the Singapore Stock Exchange in August 2012 at a valuation of about 18x forecast earnings. Almost two years later, bookbuilding for the 999.6m shares in its Hong Kong IPO opened at an indicative price range of HK$5.38–$5.92 each. The fact that pre-IPO investors planned to exit through the IPO also added to the task. Of the shares on offer, 67% was primary and 33% was secondary. Among the selling shareholders were GIC, CDH, Luye Investments, Citic Private Equity and an entity New Horizon and AXA jointly owned. The strength of Luye’s cornerstone tranche helped lure new investors to the IPO. Rather than the Chinese corporations that were a feature of many other listings during 2014, Luye drew early commitments from global investors, including healthcare specialists. Six cornerstone investors subscribed to US$280m of shares. They were Value Partners (US$100m), OrbiMed Advisors (US$50m), Prime Capital (US$50m), Trivest Advisors (US$30m), Macquarie Funds (US$25m) and Minmetals Capital (US$25m). More demand came from anchor investors, and the book was about two times covered within the first 10 minutes of bookbuilding. Final orders exceeded 10 times the stock on offer, with over 290 investors participating, and over 40% of orders received no allocations. Demand came from high-quality long-only investors, hedge funds, corporate investors and private wealth clients, but allocations were skewed towards long-only accounts, which took up 46% of the deal. The overwhelming demand allowed the deal to be priced at the top of the marketed range at HK$5.92 apiece, or a 2015 P/E of 26.6. At the final price, Luye shares were sold at a slight discount to a premium to key listed comparables. Despite pricing at an aggressive valuation, the shares traded up on debut. The stock soared 13.2% above the IPO price on July 9, and finished IFR’s review period at HK$10.49 on November 14, 77% above the offer price. Citigroup, Citic Securities International and UBS were joint sponsors. Citigroup, CLSA and UBS were joint global co-ordinators and bookrunners. To see the digital version of this report, please click here.

Trust Investment Advisors was at the centre of efforts to develop the rupee debt market in 2014, using its solid relationships to broaden the investor base for new structures in the bank capital and property sectors. India’s bond markets were in a recovery mode in 2014 after huge outflows of capital in the second half of the previous year and a standstill in the domestic market, as a result of some unclear regulation. Bond volumes, however, bounced back later in the year – thanks in part to the new products that Trust Investment helped introduce. As a non-bank arranger in a market where deals require true underwriting risk, Trust Investment managed to compete head-to-head with rivals wielding far larger balance sheets. The company used its Rs10bn-odd (US$161m) proprietary trading book carefully, quickly distributing its risk to end investors, and making bold calls on innovative structures where others shied away. It was the sole arranger on India’s first bonds backed against rental income from commercial properties – a structure that many rivals had argued would never fly with investors. Nine such deals had been assessed since 2009, but none made it to the market. Between May and June, Trust Investment sold two such offerings, totalling Rs9bn, for the DLF Group. The tightly structured bonds offered the company an attractive cost of funding, coming at yields of 10.9%. More importantly, these benchmark deals helped diversify funding sources for a sector with funding needs of around US$60bn and provided a template for other deals. Nipa Sheth, Trust Investment’s managing director, said the firm had been the only arranger that was confident of finding investors for the product. In the end, the two DLF deals were 2x subscribed with 20% of the paper going to sovereign wealth funds. Trust Investment was also at the forefront of the introduction of Basel III-compliant bonds, another key theme during the review period. In August, Trust Investment jointly arranged the first Additional Tier 1 bond from a state-owned lender, underwriting Rs6.25bn of a R s25bn 11% perpetual non-call 10-year issue for state-owned Bank of India. Amid lingering doubts over investors’ appetite for the new-style, loss-absorbing format, the deal unearthed a deeper-than-expected local bid for bank capital securities. Trust Investment also displayed its distribution capabilities earlier in March when the firm sold nearly 30% of the jumbo Rs80bn 9.95% bond from state-owned Food Corp of India. It was the largest state-guaranteed and most traded corporate bond in India. Trust Investment ranked No 2 on the Thomson Reuters rupee bond league table for IFR’s review period, having arranged 132 deals for Rs209bn. To see the digital version of this report, please click here.

RBS had a strong profile in India in its former incarnation as ABN Amro, having arranged countless corporate and acquisition loans for clients in the country before the global financial crisis. Now revamped and under new management, RBS once again proved its mettle in 2014 in the face of intense competition from foreign and domestic lenders. After a steep decline in the rupee in August 2013, India’s political and economic situation created a difficult climate until the national elections in mid-May, when a landslide win for Narendra Modi’s pro-business Bharatiya Janata Party reassured the financial sector and raised hopes for the economy. The first six months of IFR’s review period was a tense time for loan arrangers, and it was the performance of RBS during that time that set it apart from the crowd. Taiwanese banks, traditionally Asia’s largest international lenders, were deterred from providing retail liquidity to Indian companies on macroeconomic concerns and rising funding costs with the three-month TAIFX, Taiwan’s interbank US dollar lending rate, touching a two-year high of 160bp in mid-March and hovering above 150bp until mid-May. Against this difficult backdrop, RBS stepped up for its clients, and won sole mandates from sought-after borrowers in an extremely competitive market. The bank won the sole mandate from Bharat Oman Refineries for a US$70m 6.6-year loan, a bullet facility with the longest tenor for an Indian borrower since the global financial crisis. RBS syndicated the loan about the time state-owned Bharat Petroleum Corp, Bharat Oman’s 50% shareholder, launched a US$500m six-year loan with seven mandated lead arrangers and bookrunners. RBS added another feather to its cap in late January with a sole mandate on a US$400m five-year amortising loan for Bharti Airtel, which it prefunded and syndicated to seven other banks – all of which were first-time lenders to the borrower. At the time, it was the largest sole underwriting on a loan for an Indian borrower since the financial crisis. RBS also notched up repeat mandates on top-heavy loans for Hindustan Petroleum Corp, Indian Oil Corp, ONGC Videsh, Tata Power and Vedanta Resources. The facilities for IOC and ONGC Videsh were acquisition loans and, in addition to Oil India, these state-owned Indian oil-and-gas companies provided much of the deal flow in the review period. Other private sector mandates included those from Bharat Forge, Reliance Industries and Tata Communications, which helped the bank achieve a No 4 ranking in the bookrunner league tables for Indian loans in the review period with US$1.57bn of volume from a dozen deals. To see the digital version of this report, please click here.

India’s equity markets hit new heights in the second half of 2014, but it was JP Morgan’s ability to raise funds for issuers across multiple sectors throughout the year that shone through. JP Morgan worked with clients in both the public and private sectors, and at home and abroad, helping to reopen the equity markets for highly geared companies from the telecom and infrastructure sector following Narendra Modi’s May election victory. The bank was involved in a number of key deals in the earlier part of the year, when conditions were far more challenging. It handled State Bank of India’s US$1.3bn qualified institutional placement, the country’s largest such issue, in January, and arranged Make My Trip’s follow-on offering in March, the first major US offering from an Indian tech company since 2010. JP Morgan was also one of the bookrunners on the Rs55bn (US$887m) overnight block in Axis Bank in March. It was the largest Indian block during IFR’s review period and, more importantly, the first time the government had sold down its stake in the lender. The trade had some challenges from the outset. It came at a surprising time, just weeks away from the Indian general elections, and with foreign ownership already testing the regulatory limit. Fears of further sales from the government, which still holds an 11.66% stake in the bank after the disposal, also made investors wary. The issue, however, succeeded with the help of anchor investors at a tight discount of 3.1%, and the bank’s shares have performed well in the secondary market. After Modi’s victory sparked a sustained rally in Indian equities, JP Morgan was quick to spot opportunities for its clients. The Rs48bn (US$800m) qualified institutional placement of debt-ridden Reliance Communications, in June is the best example. The company, which had been unsuccessful at previous attempts to raise capital, originally planned to raise only US$300m–$400m from the placement, but the larger deal size and a concurrent Rs13bn injection from the promoters helped convince some key investors that the fundraising would make a difference to the debt burden. Notably, only 9% of the shares went to Indian investors, in contrast to the typical 60% plus in other QIPs. JP Morgan was joint global co-ordinator. GMR Infrastructure used a similar structure for its Rs15bn placement the following month, with the promoters subscribing to new shares alongside the institutional placement. JP Morgan was again one of the bookrunners. JP Morgan was not only involved in transactions, which leveraged on its global network, it was also the bookrunner on IDFC’s Rs10bn placement, which could be sold only to domestic investors. To see the digital version of this report, please click here.