GAIL to raise 2000 cr for expansion

Agencies
Posted: Tuesday, Jul 07, 2009 at 1704 hrs IST
Updated: Tuesday, Jul 07, 2009 at 1704 hrs IST

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New Delhi: State gas utility GAIL India Ltd plans to raise around Rs 2,000 crore during the current fiscal to part fund its expansion plans.

"We may borrow Rs 2,000 crore through a mix of debt from Oil Industry Development Board (OIDB), bonds and term loans," GAIL Director (Finance) R K Goel said in New Delhi.

GAIL has planned capital expenditure of about Rs 3,800 crore in 2009-10 fiscal, most of which would be for laying new gas transportation pipelines. The entire capex is to be met either through internal resources or borrowings.

Goel said GAIL may raise Rs 500 crore through a bonds issue. The bonds issue would also have a greenshoe option of Rs 200 crore.

About Rs 700 crore would be raised from OIDB and the remaining would be borrowed from banks as term loan, he said.

The borrowings may happen in November-December, he said, adding over the next three years the company would need to borrow about Rs 6000 crore.

GAIL's debt-equity ratio, which has "almost zero" debt, may rise to 1:1 in three years, Goel said.

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