Shapoorji Pallonji Group has completed one of India’s largest private credit transactions, raising approximately ₹151 billion, or $1.6 billion, through rupee-denominated bonds, according to Bloomberg. The financing demonstrates continued investor demand for large, high-yield Indian credit transactions despite volatile global markets.
The three-year bonds were issued through group company Eqyizen Investment and carry a yield of approximately 18.95%. The securities are structured as zero-coupon bonds, meaning investors receive their returns when the debt is repaid rather than through regular interest payments.
Proceeds will primarily refinance existing debt connected to Goswami Infratech, another Shapoorji Pallonji subsidiary. Goswami previously extended the maturity of its notes twice, with the total repayment obligation, including interest, reaching approximately ₹145 billion.
The rupee financing forms part of a broader refinancing package totaling approximately ₹213.5 billion. The package was reduced from an initially proposed ₹255 billion after the group reassessed its funding requirements.
Shapoorji Pallonji also raised $650 million through its first dollar-denominated debt offering. Mercury Finance issued the three-year securities at a 14.5% yield, with an option allowing redemption after one year.
BlackRock invested in the dollar bonds, while Deutsche Bank served as the sole arranger and was also a major investor. AllianceBernstein, Goldman Sachs Asset Management and Centiva Capital also participated in the international tranche.
The rupee financing attracted global special situations and distressed debt investors alongside Indian financial institutions and wealth managers. Deutsche Bank and Mercury Finance each committed approximately ₹62.1 billion to the package.
Other investors included vehicles associated with Farallon Capital Management, Cerberus Capital Management, Davidson Kempner Capital Management, Värde Partners, Ares Management and Broadpeak. Domestic participants included DSP Finance, InCred Special Opportunities Fund-I, Capri Global Capital, IIFL Management Services, Ambit Wealth, ASK Financial Holdings and Nuvama Wealth Investment.
The refinancing is backed partly by Shapoorji Pallonji Group’s approximately 18.4% stake in Tata Sons, the holding company of the Tata Group. Additional collateral includes shares in publicly listed infrastructure company Afcons Infrastructure.
Under the revised financing terms, Tata Sons must either pursue a listing or an arrangement must be established allowing Shapoorji Pallonji to sell its shares privately at a mutually agreed price within 18 months. The structure reflects investors’ focus on the group’s ability to unlock value from its substantial but illiquid Tata Sons holding.
The loan agreement also requires the group to repay approximately ₹135 billion within 24 months. These protections are intended to reduce lenders’ exposure while giving Shapoorji Pallonji additional time to complete asset sales or other transactions.
Shapoorji Pallonji is one of India’s largest private credit borrowers and has repeatedly used its Tata Sons stake to support financing. The latest transaction diversifies its funding across domestic and international investors while addressing near-term refinancing obligations.
