PFC to raise Rs 5,300 cr via infra bonds

Public sector undertaking, Power Finance Corporation (PFC), plans to raise Rs 5,300 crore from infrastructure bonds that opened on February 24, a senior PFC official said today.

"We plan to raise Rs 5,300 crore through the public issue of infrastructure bond between February 24 and March 22, 2011," PFC Director (Commercial) M K Goel told reporters here.

Under the bond issuance, an investor can avail up to Rs 20,000 rebate in the taxable income in the current financial year under section 80CCF of Income Tax Act, 1961, he said.

The deduction of up to Rs 20,000 was over and above Rs one lakh deduction that an investor can avail under section 80C of Income Tax Act, Goel said, adding PFC will provides a fixed rate of interest up to 8.5% on annual or cumulative basis, Goel said.

The bonds offered will be in maturities of 10 years and 15 years with a buyback option after five and seven years respectively, he said.

The PFC will spend the funds generated from the infrastructure bond in financial various power sector-related projects, Goel said.