The Board of Directors has approved an enhancement of the annual borrowing program for FY 2025-26 from ₹65,000 crore to ₹80,000 crore. This follows an initial approval in April 2025. Subsequent to this, the Bond Allotment Committee is set to consider the approval for issuing Perpetual, subordinated, listed, unsecured, taxable, rated, non-convertible debentures aggregating up to ₹1,500 crore via private placement on February 13, 2026.
Board Approves Borrowing Program Enhancement
Housing and Urban Development Corporation Limited (HUDCO) has formally informed the stock exchanges regarding an enhancement to its financing plans for the current fiscal year. The Board of Directors, in a meeting held on January 29, 2026, approved increasing the existing annual borrowing program for FY 2025-26. The enhanced limit now stands at ₹80,000 crore, up from the previously approved ₹65,000 crore, to be raised through various modes, including debt securities.
Intimation of Perpetual Debt Issuance
In compliance with relevant disclosure norms, the company has announced that its Bond Allotment Committee is scheduled to meet on February 13, 2026, to consider the final approval and allotment of a new series of debt securities. These instruments are structured as Perpetual, subordinated, listed, unsecured, taxable, rated, non-convertible debentures, specifically designed to qualify for inclusion in Tier I and/or Tier II capital.
Key Terms of the Proposed Issue
The proposed issuance is planned on a private placement basis and aggregates up to ₹1,500 crore. The face value per debenture is set at ₹1,00,00,000 (Rupees One Crore). The issue proceeds are intended to augment the Issuer’s long-term resources and will be utilized for regular business activities of the corporation, aligning with regulatory capital requirements.
Call Option Details
These perpetual bonds have a significant tenor structure. The Call Option Date is set for 10 years from the date of allotment (i.e., February 13, 2036), or any annual anniversary thereafter, subject to the prior approval of the RBI.
Coupon Structure and Step-Up
The coupon rate is yet to be decided on the EBP platform on the bidding date. The bonds feature a one-time Step Up Coupon Rate, which is an additional 50 basis points (bps) per annum, applicable if the Call Option is not exercised on the first Call Option Date (February 13, 2036). The Bonds are structured to be subordinated to all other creditors but senior to equity holders.
Credit Ratings and Listing
The instruments have received strong credit ratings: ‘CARE AAA’ (Stable) and ‘ACUITE AAA’ (Stable). The NCDs are proposed to be listed on the BSE on or before three trading days from the Issue Closing date.
Subscription and Yield
While the minimum issue size is ₹500 crore, the structure allows for an oversubscription option of up to ₹1,000 crore, bringing the total potential size to ₹1,500 crore. As the issue is via private placement, the standard minimum subscription rule is not applicable.
Source: BSE
