REC to raise Rs 1K cr via private placement

KOLKATA: The Rural Electrification Corporation said it will sell tax saving infrastructure bonds in January to garner Rs 1,000 crore. But the REC bonds may be elusive for small tax payers as the power financier is exploring possibilities of placing the bonds privately, instead of a public issue.

It is believed that the lukewarm appetite for tax saving infrastructure bonds has prompted REC to examine the prospect of a 100% subscription via private placement. It has engaged a host of merchant bankers to do the survey.

“If merchant bankers give an affirmative response, then we may opt for the private placement route. Nothing is final at present,” REC director for finance HD Khunteta told ET.

Otherwise, it will come out with a public issue like IDFC or L&T Infrastructure Finance. Among infrastructure bond issuers, IFCI mobilised about Rs 100 crore by placing the bonds privately in October and has entered the market again to raise another Rs 100 crore.

However, IDFC has managed to raise Rs 436 crore by selling infrastructure bonds, against its target of Rs 3,400 crore. It will enter the market again sometime between January and March next year to garner more funds. L&T Infrastructure Finance has mopped up around Rs 200 crore.