India Bond House: Trust Investment Advisors

IFR Asia Awards 2022
3 min read
Krishna Merchant

Setting benchmarks

Trust Investment Advisors focused on the best solutions for its clients, bringing out landmark private and public placements in a domestic market that remained active even as offshore issuance slowed.

Trust was ranked first in the domestic league table for the year, with a market share of 16.3% for 160 issues and Rs688.7bn (US$8.45bn) of deal volume, and it took lead roles on a number of trades that needed careful structuring to attract investors.

In June, it was the sole arranger for a Rs83.05bn social bond for Andhra Pradesh State Beverage Corp, which handles alcohol sales for the state government. The transaction was structured so that the southern state could use the levy on liquor to fund welfare schemes, reducing pressure on the state budget.

Trust helped design a credit enhancement structure which ring-fences the future levy collection on liquor sales to service the bonds on a first priority basis. The state also gave commitments on liquor distribution and pricing to maintain inflows from the levy.

The structure helped boost APSBCL’s bond rating to AA (CE) from A, according to India Ratings.

The issuer came again to raise Rs17bn from a second tranche in December.

Trust was also one of the lead arrangers for UPPCL, the holding company for the state of Uttar Pradesh’s five power distribution companies, when it printed Rs74.39bn two-tranche notes.

The UPPCL bonds were issued from a well-protected structure, with six layers of safety and ring-fencing. The security, accompanied by a government guarantee, enhanced the bond rating to A+ (CE) from India Ratings, from BBB+.

Trust was also active in the retail bond market. It assisted National Highways Infra Trust to raise Rs15bn from a maiden issue of public bonds for up to 25 years. The deal was 3.3 times subscribed on the first day, allowing the books to close early.

The bank played a key role in India’s ESG market, mobilising funds for clean energy projects. It was one of the arrangers for the maiden two-tranche offering of Rs7bn by AnZen India Energy Yield Plus Trust, which focuses on energy assets such as transmission lines and renewable energy projects.

It was the sole arranger for a Rs6.12bn bond offering by units of Adani Green Energy for debt repayment. The success of the February deal encouraged more Adani group companies to issue onshore bonds for refinancing and fund growth, as offshore markets remained volatile.

Trust has also worked on other marquee structured bond transactions for issuers such as Mindspace REIT, cement company Nuvoco Vistas, and renewable energy firm Acme Solar, and helped arrange Bank of India’s Additional Tier 1 bonds.

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