Astana, November 6. Qazaq Bitum Processing has placed bonds worth 5 billion tenge on KASE in a single day: against a declared volume of 1 billion tenge, demand for the debut issue came to 10.2 billion tenge, investment bank Teniz Capital Investment Banking said.
The issuer raised the placement to 5 billion tenge and sold the whole issue, but even then demand remained twice the supply. Of the investors, 66% were individuals, 24% other legal entities and 10% broker-dealer organisations. The issue is the first tranche of a 50-billion-tenge programme: a bond has a face value of 1,000 tenge, a coupon of 22% a year paid quarterly and a term of two years, from November 5, 2026 to November 5, 2028. The ticker is QBTMb1 and the international code is KZ2P00020753.
Qazaq Bitum Processing, by Teniz Capital’s description, is one of Kazakhstan’s largest producers of road bitumen with a market share of about 26%, and the country’s only producer of polymer-modified bitumen, which is used for airport and toll-road surfaces. Petroleum bitumen is also on the list of products whose export Kazakhstan has banned until May 22, 2027; whether this will affect the issuer is not said in the announcement.
What it means: A company that had not previously entered the bond market collected ten times more bids than it asked for on the day of placement, and two-thirds of the investors were individuals. A 22% annual coupon shows the price the issuer is willing to pay to borrow; market rates on other issuers’ bonds are not given in the announcement.
Who benefits: The issuer, which obtained 5 billion tenge for two years and kept the option to borrow more under the 50-billion programme. Investors who bought bonds yielding 22% a year, provided the issuer meets its obligations; the announcement does not discuss risks.
Background: A bond is a debt security: the investor lends money to the issuer and receives a coupon, that is interest, and the face value at the end of the term. A bond programme is a framework for a total sum from which an issue is made in parts, called tranches. Bitumen is a viscous substance left over from oil refining, from which road asphalt is made; polymer-modified bitumen is more resistant to loads and temperature swings. KASE is the Kazakhstan Stock Exchange.
