LIC Adani Ports bond subscription: LIC invests Rs 5,000 crore in Adani Ports NCD

Mumbai: State-run Life Insurance Corporation of India subscribed to the entire ₹5,000-crore non-convertible debenture (NCD) issue of Adani Ports and Special Economic Zone underscoring sustained efforts by India’s largest private port operator to refinance short-term debt with longer-tenor borrowings at lower rates.

The 15-year bond, carrying a coupon of 7.75%, was issued on Thursday. It marks one of the longest-duration domestic issuances by the Adani Group in recent months.

LIC, which currently owns 8.06% of Adani Ports, was the sole investor, said people familiar with the matter. Proceeds from the issue will be used for capital expenditure, refinancing existing debt and general corporate purposes.

The Gautam Adani-led conglomerate is actively pursuing moves to extend debt maturity profile and lock in lower borrowing costs. The group’s average cost of funds fell to 7.92% in FY25 from 9.02% in the previous fiscal year, aided by a mix of strategic refinancing.

“This deal shows LIC is taking large exposure to corporate bonds,” said the head of fixed income at a domestic brokerage, requesting anonymity.

LIC had ₹80,000 crore invested in corporate bonds as of FY25-end. Adani Ports is continuously exploring ways to replace high-cost debt. The company has increasingly turned to long-tenor instruments to trim interest burden and improve cash flow visibility.Spokespersons for LIC and Adani Ports did not respond to requests for comment.

As of March 31, Adani Ports’ net debt stood at ₹36,422 crore, with Ebitda at ₹20,471 crore, and a net debt-to-Ebitda ratio of 1.78x – improving from 2.3x in FY24. The company – with a cargo handling capacity of 633 million metric tonnes – handled 450 MMT last fiscal.

Its portfolio includes 15 domestic ports/terminals and an asset each in Israel, Tanzania, Australia and Sri Lanka.