Two major Tata Group companies are preparing to return to the corporate bond market after more than 15 months of absence. According to reports from Reuters, Tata Steel is planning to raise ₹3,000 crore through five-year bonds, while Tata Projects, a real estate firm, could raise ₹500-₹1,000 crore through a combination of three-year and five-year papers. Both companies have alerted merchant bankers and are waiting for rates to ease further before proceeding with their market taps. The bankers confirmed that these two Tata Group infrastructure units are set to re-enter the corporate bond market in the coming days, as reported by Reuters.
Indian corporate bond yields have improved following the Reserve Bank of India's decision to maintain key policy rates unchanged last week. As reported by Reuters, yields on AAA-rated two-to-five-year corporate bonds had risen past 8 per cent before the RBI's rate decision, marking their highest level since early 2019 according to LSEG data. Since the rate announcement, yields have declined by approximately 50 basis points. This recent easing of yields has provided some relief to the market and has encouraged these Tata Group companies to consider their bond issuances, with one banker noting that both companies are waiting for rates to ease further before tapping the market.
Tata Steel, which has over ₹15,000 crore in outstanding bonds, faces a ₹1,000-crore maturity coming up in October. The AAA-rated borrower last accessed the market in February 2025, successfully raising ₹3,000 crore via five-year bonds at a 7.65 per cent coupon. During the same month, AA-rated Tata Projects raised ₹500 crore by selling six-year bonds at a 8.60 per cent coupon. According to Reuters, Tata Steel has over ₹150 billion rupees in outstanding bonds, highlighting the significant scale of its debt obligations. Tata Projects did not reply to requests for comment regarding their planned bond sales.
Both companies have been approached by merchant bankers regarding their potential bond issuances, though Tata Steel has stated it has no imminent plans for bond issuances. According to Reuters, Tata Projects did not reply to requests for comment regarding their planned bond sales. The timing of these potential issuances reflects the companies' assessment of current market conditions and their respective funding requirements. The bankers who confirmed the developments asked not to be named as they are not authorised to speak to the media.
