India offshore bond craze rolls on after record 2019 sales

New Delhi: Indian companies have started the year with more debt offerings overseas, after record issuance in 2019 driven by stronger borrowers turning abroad as local credit markets struggled.

The firms sold a record $22 billion of notes overseas in 2019. Yield-hungry global investors have been betting that the kind of higher-rated Indian issuers that have been big sellers could continue to sidestep onshore bond market jitters and a spike in defaults.

“Given the tight funding conditions in the local market and the upcoming maturities and calls in 2020-2021, I think dollar issuance from India will continue to be high this year,” said Bharat Shettigar, head of Asia excluding China corporate credit research at Standard Chartered in Singapore. Considering that Lunar New Year holidays across Asia are early this year, many issuers will front-load issuance in the first few weeks of the year, he said.