NTPC Ltd, India’s largest power producer, said it is raising $400 mln (Rs 2,600 cr) by selling dollar-denominated bonds that carry a 4.5% interest.

The bonds were priced yesterday and the issue is now open, the company said.

The notes will mature on March 19, 2028.

Both the principal and interest payments will be made in U.S. dollars, which makes the bonds resistant to the decline in the value of the Indian rupee.

The notes present an attractive opportunity for overseas bond investors, given the high interest yield and the status of NTPC as a government of India company.

In comparison, the yield on a 10-year US treasury bill is only around 2.81%.

The bonds are unsecured, and will be listed on the Singapore Exchange Securities Trading and India International Exchange IFSC. Interest will be paid every six months.

The proceeds from the issue will be used to finance capital expenditure of ongoing and/or new power projects, coal mining projects, and renovation and modernisation of power stations, NTPC added.

“The use of proceeds will be for projects only in India,” it added.

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