Saturday, August 31, 2013

HUDCO's Rs 500cr tax-free bonds issue opens

In the first tranche, which was launched On January 9 and closed on February 7, the company had raised Rs 2,195 crore. The second tranche would open from today and close on March 15, 2013 .

"We are launching the second tranche of our tax-free bonds from tomorrow. The issue size is Rs 500 crore with an option to retain over-subscription up to Rs 2,805 crore," HUDCO Chairman and Managing Director V P Baligar told PTI.

HUDCO would utilise the issue proceeds for lending purposes, working capital requirements, augmenting resource base of the company and other operational requirements.

It would offer a higher coupon rate of 7.69 percent for 15 years maturity period and 7.53 percent for 10 years to retail investors. An investment up to Rs 10 lakh qualifies under retail category. For others, the coupon rates are 7.19 percent for 15 years and 7.03 percent for 10 years.

The coupon rates for retail investors are lower than the first tranche as interest rates have gone down, he added. HUDCO, a mini-ratna firm, is a financial institution that provides long-term finance for housing and urban infrastructure projects.

The company had posted net profit of Rs 630.33 crore over a gross income of Rs 2,778.63 crore in the 2011-12 fiscal. The company is expecting to achieve the sanctioning and disbursal targets for this fiscal at Rs 22,000 crore and over Rs 6,000 crore, respectively.

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