Shapoorji Pallonji Group Unit Eqyizen Investment Plans to Raise Up to $200 Million in Rupee Debt

Eqyizen Investment, an entity belonging to the Shapoorji Pallonji (SP) Group, is planning to raise approximately $150 million to $200 million in rupee-equivalent funds. According to two bankers who spoke on the condition of anonymity on Friday, the capital will be raised through the sale of zero-coupon rupee-denominated bonds that are scheduled to mature in July 2029.

One of the bankers stated that the company will finalize the specific borrowing quantum in rupee terms and aims to complete the issuance before the end of November. The Shapoorji Pallonji Group did not respond to a Reuters request for comment regarding the planned debt issuance.

Bankers indicated that the move stems from unutilized portions of the company's approved borrowing limits, prompting the firm to utilize this capacity to meet its fundraising targets.

This planned debt raise follows previous fundraising activities by group entities. In October, Eqyizen Investment raised approximately ₹4,450 crore, equivalent to about $473 million, through a similar debt issuance at an 18.95% yield. This followed an earlier fundraising round in July, where the company raised around ₹21,350 crore via another issue at the same yield.

In both of the previous instances, Mercury Finance—another firm under the SP Group umbrella—raised funds via zero-coupon US dollar-denominated bonds due in July 2029 and subsequently invested the proceeds into rupee securities issued by Eqyizen.

Market sentiment and the outlook for the real estate conglomerate's bonds have seen some improvement following statements from Tata Trusts, the controlling shareholder of Tata Sons. Tata Trusts previously disclosed that the SP Group had submitted a proposal to sell ₹25,000 crore worth of its stake in Tata Sons. However, that proposal has not yet progressed due to existing differences between Tata Trusts and Tata Sons.

"Large conglomerates often utilize structured debt instruments across group entities to optimize their capital structures and manage liquidity requirements. For the Shapoorji Pallonji Group, leveraging unutilized borrowing limits through zero-coupon rupee-denominated bonds reflects an ongoing strategy to manage funding needs. While recent fundraising has relied on specific group synergies, the broader financial outlook for such debt instruments will continue to be influenced by asset monetization plans and resolution of broader stakeholder discussions." — Dr. Shishir Gupta, Founder & CEO, StartupLanes