Indian Railway Finance Corp (IRFC) will hit the market on January 6 to raise more than R8,660 crore through tax-free bonds. The issue of tax-free and secured non-convertible bonds, worth around R8,663 crore, will close on January 20, IRFC said in the prospectus filed with Sebi.
“Public issue by Indian Railway Finance Corporation of tax-free, secured, redeemable, non-convertible bonds of face value of R1,000 each in the nature of debentures having tax benefits... for an amount of R1,50,000 lakh with an option to retain over-subscription up to R7,16,300 lakh aggregating to R8,66,300 lakh in the fiscal 2014,” the company said.
The funds raised through this issue will be utilised by IRFC towards financing the acquisition of rolling stock, which will be leased to the ministry of railways in line with present business activities. IRFC is a dedicated financing arm of the ministry of railways. Its sole objective is to raise money from the market to part finance the plan outlay of Indian Railways.