Cost of money has increased by 150-200 bps says SREI Infra

Hemant Kanoria, chairman and managing director, SREI Infrastructure in an interview to CNBC-TV18 spoke about the company's tax saving bonds issue, which is open for subscription.

It aims to garner Rs 300 crore through the first tranche of the issue. The company would come out with the second tranche and subsequent issues, if it receives good response for the first tranche. Since the interest rates have been rising throughout the year, cost of money for SREI has increased by 150-200 bps. "If we see a decline in interest rates, we still have 2-2.5 months to go for that, then our average cost will get adjusted to that minor in extent," he added.  Below is the edited transcript of Kanoria's interview with Latha Venkatesh and Sonia Shenoy of CNBC-TV18. Also watch the accompanying video. Q: You have a tax saving bond issue open. Can you give us details - what it will cost you and how much it will earn investors? A: We are issuing these tax free bonds for the first time from our company. Though as an IFC which we got registered last year with RBI in March, we were allowed to raise infrastructure tax free bonds for financing the infrastructure sector. But, we were see interest rates stabilize and it is more towards the closure of the financial year that people start the investment. That is why we though that this is an appropriate time to go ahead with it. Returns are quite good because they get 9% plus return and it's tax free. So to the amount of Rs 20,000 is very small. We have already requested the government to think that whether this can be increased the limits from Rs 20,000 to Rs 2 lakh. But nevertheless at present we have launched with Rs 20,000 and we