Thank you!
We have received your details.
Our Customer Care Executive
shall contact you shortly!

Working hours: 9:00AM to 6:00PM IST (Mon-Sat).

News Updates



Indiabulls Housing Finance Issues Rs. 13.30 Bn of Rupee Denominated Affordable Housing Masala Bonds

Indiabulls Housing Finance Ltd. (IBHFL) today successfully priced its first overseas issue of unrated rupee denominated affordable housing masala bonds. Yes Bank, Axis Bank, Merrill Lynch, Nomura, Credit Suisse and Citibank were the joint book runners and joint lead managers in the transaction. IBHFL is the second housing finance company (HFC) and the fourth Indian corporate to issue rupee denominated bonds overseas pursuant to applicable Reserve Bank of India guidelines.

Rupee denominated bonds, which are also known as ‘Masala Bonds’, are instruments through which Indian entities can raise funds by accessing overseas capital markets and the bond investors hold the currency risk. The deal was announced on September 6, 2016 and attracted very high quality demand. The INR 13.30 Bn issue of secured rupee denominated affordable housing masala bonds bears a coupon of 8.57% and has a tenor of 3 years and 1 month. This is a rupee based transaction and there is no foreign exchange exposure for IBHFL. The bonds will be listed on the Singapore Stock Exchange and cannot be traded in the local Indian market. The issue proceeds would be used for IBHFL’s housing finance business, particularly housing loans in the affordable housing segment, as well as for general corporate purposes.

Commenting on the transaction Mr. Gagan Banga, Vice Chairman and Managing Director, of IBHFL said “This successful issue opens up a vast pool of debt capital for IBHFL and further strengthens our bond programme by adding options that diversify our funding profile away from bank term loans. The government’s and the regulator’s efforts of directing efficient finance to the affordable housing segment is bearing fruit and quality global investors are reposing confidence in the Indian housing finance sector.”

IBHFL has the highest AAA credit rating and the affordable housing masala bonds issue adds to an already well diversified funding mix of strong bond issuances and a large portfolio sell down programme, thus increasing avenues of funding other than term loans from banks. The strength of the domestic AAA rating and the quality of the credit enabled IBHFL to attract high quality demand to the affordable housing masala bond despite the issue not having an international rating.

In just over five months of FY 2016-17, IBHFL has issued Rs. 110 Bn of bonds compared with Rs. 99 Bn issued in the whole of FY 2015-16. Bonds are substantially cheaper when compared with bank term loans and represent the most efficient source of funding. The acceleration in the bond programme will enable IBHFL to increase home loans’ pace of growth and sustain or even increase margins.

Affordable housing represents a vast, scalable opportunity and IBHFL is focused on housing loans in the affordable housing segment. Demographic factors like accelerating urbanization and a literate, young population fuelling an expanding workforce, build on an already existing urban housing shortage. It is estimated that by 2022 an additional 34 Mn residential units would be needed in urban India. The government has unveiled many measures to meet this key socio-economic requirement under its headline mission of “Housing for all by 2022”. A combination of fiscal policies backed up by efforts to direct efficient funding to the housing sector has lent a further fillip to the housing finance sector that was already growing at a CAGR of 19% for the past 5 years. Resultantly, house sales data for the first quarter of FY 2016-17 indicate a strong uptick in housing sales and housing credit off take in the affordable housing segment.


About Indiabulls Housing Finance Limited

IBHFL is India’s 2nd largest Housing Finance Company by profits and networth in the private sector. IBHFL has a balance sheet size of Rs. 82,069.2 crore with over 5,600 employees. It provides quick, convenient and competitively priced home loans in the affordable housing segment. IBHFL enjoys a AAA long-term rating.