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Feb 23, 2013, 12.48 PM IST | Source: Moneycontrol.com

IRFC’s Rs 1,000cr tax free bonds issue to open on Feb 25

State-owned Indian Railway Finance Corporation (IRFC) will launch its tax free bonds issue of Rs 1,000 crore of face value of Rs 1,000 each on Monday, February 25, 2012. It has an option to retain oversubscription upto Rs 3,513.01 crore.

State-owned Indian Railway Finance Corporation (IRFC) will launch its tax free bonds issue of Rs 1,000 crore of face value of Rs 1,000 each on Monday, February 25, 2012. It has an option to retain oversubscription upto Rs 3,513.01 crore.

According to the CBDT notification, the company proposed to raise upto Rs 10,000 crore through issue of bonds in the year 2012-13. Out of which, IRFC already raised Rs 1,113.60 crore through five private placements issuances and Rs 5,373.39 crore through public issue of tax free secured redeemable non-convertible bonds of tranche I.

Coupon rate for retail investors, NRIs and HUFs (which are applying for an amount aggregating up to Rs 10 lakh across all series of bonds in each tranche issue) will be 7.38 percent in case of series I and 7.54 percent in series II. Coupon rate for other investors will be 6.88 percent in series I and 7.04 percent in series II.

Redemption of bonds will take place at the end of 10 years and 15 years from the deemed date of allotment for series I and series II, respectively. IRFC will make interest payment on bonds on annual basis.

Bids can be made for minimum of 5 bonds across all series of bonds and in multiples of one bond thereafter. The issue will close on March 13, 2013.

Credit rating agencies namely CRISIL, ICRA and CARE assigned AAA rating for this debt programme.

Bonds are proposed to be listed on Bombay Stock Exchange and National Stock Exchange.

The book running lead managers to the issue are SBI Capital Markets Limited, AK Capital Services Limited, Axis Capital Limited, ICICI Securities Limited and Kotak Mahindra Capital Company Limited.

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