Tata Capital raises USD 400 million from a bond issue in the US

“Real money investors, including asset managers from Asia and Europe, dominated the demand for bonds, which were not open to US investors since it was a regulation S (Reg S) transaction,” said a person familiar with the issue.

ET had reported about the likely Tata Capital issue in its July 7 edition.

These instruments would mature in 42 months, marking only the second dollar bond sale for Tata Capital. The company generated a peak order book of $2.10 billion, people familiar with the issue said.
The bond was finally priced at 107 basis points above the three-year US treasury, much tighter than the company’s initial price guidance of 140 basis above the US bond. One basis point is 0.01 percentage point.

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With the three-year US bond trading at 4.26%, the final coupon on the Tata Capital bond is likely to be around 5.33%. A Tata Capital spokesperson did not reply to an email seeking comment.
This bond issue is only the second overseas bond issue from the company after its debut in the international market in January 2025. The company had then raised an identical $400 million by selling dollar bonds maturing in three-and-a-half years to investors in Asia and Europe at a price of 92 basis points above the three-year US treasury.

HSBC, Standard Chartered and MUFG were the bankers to the issue. In February, Fitch Ratings had affirmed Tata Capital’s long-term foreign- and local-currency ratings at ‘BBB-‘ in line with India’s sovereign rating underpinned by expectation that its parent, Tata Sons would provide extraordinary support to the financing subsidiary in times of need.