Four bankers told Reuters on Monday that India's Jio Financial Services is in early talks with merchant bankers about its first bond sale. According to the bankers, the company may seek to raise Rs 5,000 crore ($600.6 million) to Rs 10,000 crore through the offer and may enter the market in the fourth quarter of this fiscal year.

According to them, Jio Financial, which was spun off from Reliance Industries, is in the process of obtaining a credit rating and other essential clearances. The bankers declined to be identified because they are not authorized to speak to the media, and Jio Financial did not immediately respond to an email from Reuters seeking comment.

The August-listed company intends to build itself as a full-service financial services organization in a fast rising sector, including auto, house loans, and other goods, competing with companies such as Bajaj Finance. "Jio Financial has a strong promoter parentage, and it is expected that the company will automatically receive a AAA credit rating," said Venkatakrishnan Srinivasan, founder and managing partner of Rockfort Fincap. 

"While the pricing will depend on factors like tenor and balance sheet size of the company at the time of issue, being an NBFC, it will be 10-20 basis points higher than RIL." Reliance Industries raised 200 billion rupees earlier this month through 10-year notes, the largest sale by a non-financial Indian corporation, paying 40 basis points more than the government's borrowing cost.

Bankers have urged that Jio Financial issue shorter-term commercial papers and set up bank borrowing lines ahead of the bond sale, according to two bankers. 

According to four bankers, it is also advised that bonds have a maximum term of five years. "Because the company is new, the documentation and compliance will take time, and we could see them coming in before the end of March," a private bank merchant banker said.