GAIL India's ₹1,575 Crore Bond Disclosure : A Regulatory Update

In FY 2022, GAIL India raised ₹1,575 crore through the issuance of secured redeemable non-convertible debentures (NCDs). In a procedural update disclosed on the exchanges on April 16, the issuer confirmed that scheduled coupon payments have been duly executed as per the payment timeline. 

Bond Issuance Details

As India’s leading player in the natural gas sector, GAIL's decision to tap the debt market aimed at shoring up financial flexibility and funding ongoing projects. The bond issuance details are as follows:

• Issuer: GAIL (India) Limited
• Issue Size: ₹1,575 crore
• Security: Secured, Redeemable, Non-Convertible Debentures (NCDs)
• Purpose: General corporate purposes and capital expenditure

Credit Rating by ICRA: AAA/Stable

ICRA, a leading credit rating agency, assigned a AAA/Stable rating to GAIL’s bond issuance in December 2022. This rating signifies the highest degree of creditworthiness, indicating GAIL’s strong ability to meet its financial obligations in a timely manner. The “Stable” outlook suggests that ICRA anticipates consistent financial performance and stability in GAIL’s operations.

The AAA rating by ICRA is underpinned by the following factors:

• Dominant Market Position: GAIL's leading position in natural gas transmission and marketing in India.
• Strategic Importance: GAIL's crucial role in India's energy infrastructure, supporting the country's energy security objectives.
• Strong Financial Profile: Healthy profitability, cash flow generation, and prudent financial management.
• Government Support: Indirect benefits derived from government policies favoring the natural gas sector.

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