Srei aims to broadbase borrowing options

January 7th, 2012 - 10:39 pm ICT by IANS  

Kolkata, Jan 7 (IANS) Kolkata-based Srei Infrastructure Finance (SIFL), one of the leading non-banking financial institutions (NBFC) of the country, is aiming to broadbase its borrowing options and may come up with a retail bond in the future.

The NBFC, which was traditionally dependent on borrowing from banking system for its funds, is also planning to launch an infrastructure debt fund through mutual fund route. This is expected in the next financial year.

“Srei plans to have a basket of borrowing options before it. The tax-saving, long-term infrastructure bonds are our first endeavour towards this,” SIFL joint managing director Saud Siddique told reporters here Saturday.

The company has just announced a public issue of long-term infrastructure bonds with a face value of Rs.1,000 each, in the form of secured redeemable non-convertible debenture, to raise up to Rs. 300 crore in the first tranche, out of Rs 500 crore it has approval for, from the company board.

Siddique said that this was a small issue of Rs.300 crore and, thus, it will not impact the cost of borrowing but open up new avenues for the same.

The second tranche, depending on the responses to the first, could happen this financial year itself.

The company will soon raise around $15 million (around Rs.75 crore) through the ECB route from Austrian Development Bank.

“Where ECBs are concerned, under the automatic route, the company can raise 50 percent of its net worth via this instrument. Over and above that, it can seek the RBI’s (Reserve Bank of India) permission, which it plans,” Group CFO Sanjeev Sancheti said.

Srei, which had total market borrowings of around Rs.13,000 crore, of which around Rs.3,000 crore was in foreign currency, recently raised $30 million in ECBs following scarcity of dollar.

Total foreign currency borrowings of the Group currently stood around $500 million, of which around $100 million is hedged.

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