IIFCL's Rs 200cr tax free bonds issue to open on Monday

The tranche II of tax free bonds issue of India Infrastructure Finance Company (IIFCL) will open for subscription on Monday, February 25, 2013. The company aims to raise Rs 200 crore through the issue with an option to retain oversubscription up to the residual shelf limit of up to Rs 6,331.1231 crore.

According to the CBDT notification, the company proposed to raise upto Rs 10,000 crore through issue of bonds in the year 2012-13. Out of which, IIFCL already raised Rs 785 crore on a private placement basis in two tranches and Rs 2,883.88 crore through public issue of tax free secured redeemable non-convertible bonds of tranche I.

Coupon rate for retail investors, NRIs and HUFs (which are applying for an amount aggregating up to Rs 10 lakh across all series of bonds in each tranche issue) will be 7.36 percent in case of series I, 7.52 percent in series II and 7.58 percent in series III. Coupon rate for other investors will be 6.86 percent in series I, 7.02 percent in series II and 7.08 percent in series III.

Redemption of bonds will take place at the end of 10 years, 15 years and 20 years from the deemed date of allotment for series I, series II and series III, respectively. IIFCL will make interest payment on bonds on annual basis.

Bids can be made for minimum of 5 bonds across all series of bonds and in multiples of one bond thereafter. The issue will close on March 15, 2013.

Credit rating agencies namely Brickworks, ICRA and CARE assigned AAA (stable) rating for this debt programme.

Bonds are proposed to be listed on Bombay Stock Exchange.

The book running lead managers to the issue are SBI Capital Markets Limited, A K Capital Services Limited, Axis Capital Limited, ICICI Securities Limited and Kotak Mahindra Capital Company Limited.

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