PFC to raise Rs 3,876 cr via tax-free bonds

Proposed issue is part of its plan to garner Rs 5,000 cr by way of issuing tax-free securities in the fiscal 2013-2014

State-run lending agency Power Finance Corp (PFC) has filed draft documents with market regulator Sebi for raising up to Rs 3,876 crore through tax- free bonds by March next year.

The proposed issue is part of its plan to garner Rs 5,000 crore by way of issuing tax-free securities in the fiscal 2013-2014. Of the total target, Rs 1,124.10 crore has already been raised.

"...Company (PFC) proposes to raise balance amount of upto Rs 3,875.90 crore through this issue of the bonds in one or more tranches prior to March 31, 2014, as approved by its Board," according to draft prospectus file with Securities and Exchange Board of India (Sebi).

The company, which is engaged in financing power generation and transmission projects, said that proceed of the issue would be utilised towards general lending operations of the company and other associated business objectives and to discharge existing debt obligations.

ICICI Securities, A K Capital Services, Axis Capital and Edelweiss Financial Services are book running lead managers to the issue.

PFC said Ministry of Finance has authorised it to raise the bonds aggregating to Rs 5,000 crore in fiscal 2014 out of it has raised an amount of Rs 1,124.10 crore on a private placement basis.