7 PSUs Allowed to Raise Rs 40k cr via tax-free bonds

NEW DELHI: Around Rs 40,000 crore tax-free bonds is likely to hits the streets in the current fiscal year with the government allowing seven companies to raise the funds through this route.  More than half of the capital, i.e. around Rs 24,000 crore would be raised by National Highways Authority of India alone. Indian Railways Finance Corporation is permitted to raise Rs 6,000 crore, Housing and Urban Development Corporation has been allowed to raise Rs 5,000 crore and Indian Renewable Energy Development Agency, Rs 2,000 crore.  NTPC, Power Finance Corporation and Rural Electrification Corporation can issue tax-free bonds of Rs 1,000 crore each, according to a CBDT circular. The AAA-rated bonds will have a tenure of 10, 15 or 20 years and the interest rate is to be decided with reference to the rates of G-secs. Retail investors can invest up to Rs 10 lakh in such bonds. 

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