Lahore: The Water and Power Development Authority (WAPDA) has decided to float its first Green Eurobond, called Indus Bond, to raise USD 500 million, the news story read. The 10-year Indus bonds will be available at a 7.5% interest rate.
Reportedly, even before the official launch ceremony on May 31, the bonds have already attracted USD 3 billion from international investors, six times what WAPDA initially envisioned. Some of the largest financial organizations including Goldman Sachs, Blackrock, Bluebay, Fidelity, Ashmore, Amundi, and UBS have shown their interest in these bonds already.
WAPDA Chairman retired Lt Gen Muzammil Hussain while talking to the media, expressed his pleasure on the development and dubbed it as a show of investors’ confidence in WAPDA and particularly in Pakistan.
WAPDA is raising USD 500 million through Indus bonds out of USD 2.2 billion it needs for the next five years. The bonds are expected to increase in numbers as the new dam projects start.
The new Indus bonds were floated in category Reg-S in London Stock Exchange with a market cap rate of 7.5% much higher than the 7.35% of Pakistan Sovereign Bond, which is expected to mature in 2031. The bonds will help to fund cash-intensive energy projects.
The source also said that the third-party evaluation of the bonds has shown confidence in the venture, while they have not put any monetary obligation on the government. The report released also shows that JP Morgan bank is managing the bonds with Habib Bank Limited (HBL), Standard Chartered, and Deutsche as co-managers.
Leading financial experts have expressed their confidence in the development and urged the government to plan more such projects.
Nauman Ahmad is an imaginative Pisces whose love for literature and nature is unparalleled. When he's not reading or hiking, he's sleeping and eating, which gives him plenty of energy for his next adventure.
