Transactions with SOCAR bonds exceed $ 120 mln

Baku. 8 December. REPORT.AZ/ Volume of transactions with bonds of the State Oil Company of Azerbaijan Republic (SOCAR) in the securities market of Azerbaijan exceeds $ 120 mln.

Report informs citing SOCAR Capital LLC, volume of transactions with the bonds hit record high again in early December as a result of great interest in the securities.

Notably, SOCAR bonds for the domestic market issued in September 2016 in the amount of $ 100 mln. Due to its high profitability and reliability, SOCAR bonds caused great interest of investors. As a result, in August, despite less than a year since its issue, volume of transactions with the bonds at the Baku Stock Exchange (BSE) exceeded $ 100 mln and volume of bond issue. Shortly afterwards, this figure reached $ 120 mln. This is first such case in the Azerbaijani stock market.

The other reason of such high demand for SOCAR bonds is repurchase guarantee for the bonds. As a result, bonds price never fall below than nominal cost of $1,000 and can be immediately converted into cash. Execution of obligations on SOCAR bonds according to the schedule, namely timely payment of interests (annual 5%) strengthened investor confidence. So far, interest payment on SOCAR bonds was made 4 times and bondholders made benefit of $ 5 mln. The next interest will be paid on January 17.

Demand for SOCAR bonds is also high now, which led to price rise of the bonds in the secondary market. As a result, the bond price exceeded 1.020 USD in a short time. According to the statement by PSG Capital investment company, market-maker of the bonds, currently, buying price of SOCAR bonds at the stock exchange varies between $ 1.006-1.007, selling price between $ 1.020-1.026.

Notably, at present, SOCAR bonds can be purchased only from the secondary market, namely through the stock exchange from current holders of the bond. Bondholders do not want to sell them at a price below $ 1,020.