Reliance Industries Ltd has been honored with the prestigious ‘Issuer of the Year’ Award by International Financing Review (IFR) Asia for its outstanding performance in securing optimal pricing for super-sized funding deals amid challenging market conditions throughout 2023.
IFR, a globally recognized financial publication specializing in fixed income, capital markets, and investment banking news, praised Reliance Industries Ltd for its adept navigation of onshore and offshore funding, achieving optimal pricing results from supersized deals. In a comprehensive two-page commentary titled ‘Blockbuster Producer,’ IFR highlighted the resilience of the Indian conglomerate in a tumultuous year for debt markets.
Reliance Industries Ltd has now become the sole entity in Asia to have clinched this esteemed award four times, having previously won in 2006, 2015, and 2018. The latest accolade reaffirms Reliance’s financial prowess and strategic acumen.
The key financing deals that contributed to Reliance’s victory in 2023 include the successful raising of USD 7.5 billion in syndicated loans, marking the largest amount raised by any corporate in the Asia Pacific region. This syndication involved an unprecedented collaboration with a record-breaking group of 55 banks, making it the most widely syndicated Indian deal to date.
Notably, Reliance Jio Infocomm achieved a milestone by raising its first-ever syndicated loan solely based on its standalone financials, without a guarantee from its parent company. Despite this, the pricing differential between Reliance Industries Ltd and Jio on the syndicated loans was a mere 10 basis points, signaling Jio’s maturation in the international financial markets.
The conglomerate also successfully secured USD 5 billion from some of the world’s largest export credit agencies (ECAs), including contributions from Sweden, Finland, Canada, and Korea. Another notable accomplishment was Reliance’s issuance of a Rs 20,000 crore 10-year rupee bond, the largest ever by a non-financial corporate, which witnessed significant oversubscription.
The bond issuance set benchmarks, achieving Reliance’s lowest coupon and the tightest spread for a rupee bond – a mere 40 basis points over the Indian government’s 10-year security, outperforming many state government bonds.
In June 2023, Reliance signed a USD 2.45 billion refinancing deal, comprising a USD 2.105 billion 4.25-year tranche and a Yen 49.682 billion (USD 351 million) 5.25-year tranche. The conglomerate not only secured diverse support from 34 lenders but also managed to reduce its all-in cost, showcasing its financial acumen.
The IFR Asia article sheds light on the challenging corporate fundraising landscape in 2023, emphasizing the impact of high US dollar rates on Asia’s offshore loan market and the volatility in the US dollar bond market. Despite these challenges, Reliance Industries Ltd successfully navigated through the complexities and emerged as a beacon of resilience and financial excellence.
Moreover, the article underscores the impact of India’s decision to raise the withholding tax on external commercial borrowings from 5 percent to 20 percent in July 2023, effectively elevating the cost of borrowing for corporates. Reliance’s ability to overcome such hurdles further highlights its financial dexterity and strategic foresight.