Rural Electrification Corporation of India Limited (REC) is aiming to raise a second tranche of $500 million through external commercial borrowings (ECBs) to support its long-term and short-term lending activities.
The navratna company, which funds and promotes rural electrification projects across India, has in-principle approval from Reserve Bank of India for raising ECBs totalling upto $750 million for funding infrastructure power projects. “By March 31, we are hopeful of raising $500 million through a mix of syndicated term loan and debt,” Ajeet Agarwal, Director-Finance, REC told Express.
Of the $750 million, he said the company has already raised $250 million. REC has currently invited bids from banks for raising a syndicated term loan of $150 million with a green shoe option. The loan has a tenor of three years with interest to be paid semi-annually.
Meanwhile, REC has also launched the public issue of tax free bonds to raise `4,500 crore. The company, which has targetted to raise ` 30,000 crore during the current fisacal, has so far raised `22,000 crore through various instruments. These bonds are offering interest rates in the range of 7.22% and 7.38% annually. The proceeds from the issue, which will remain open from December 3-10, will be utilized for lending operations of REC.