India's Muthoot Finance closes $600 million dollar bond sale

By Dharamraj Dhutia

MUMBAI, Jan 30 (Reuters) - India's Muthoot Finance MUTT.NS has accepted bids worth $600 million for dollar-denominated bonds maturing in four years and six months, the country's largest gold finance company said in a notice to stock exchanges on Friday.

The company will offer a yield of 5.75% to investors, below the initial price guidance of 6.1250%, two merchant bankers said.

"The net proceeds from each issue of notes will be applied by the issuer for the purpose of onward lending and other activities as may be permitted by the ECB Guidelines," Muthoot Finance said in the notice.

Financial research firm CreditSights puts the fair value of the issuance at 5.75% and rates it "market perform", citing the company's strong fundamentals.

In August 2025, Muthoot Finance raised $600 million through a similar bond issue, and another $150 million via a reissue in October.

We expect a similar fact pattern for the current bond, as $750 million may be too large for the issuer to deploy in a quarter, and so a benchmark new issue can be expected in the following quarter, CreditSights said in a note.

The bonds are expected to be rated 'Ba1' by Moody's Investors Service and 'BB+' by S&P, in line with the issuer's ratings, the bankers said.

This is the third dollar-bond sale from India this year after EXIM Bank and an Indian unit of U.S.-listed ReNew Energy Global RNW.O raised an aggregate of $1.6 billion.