REC seeks shareholders' nod to raise borrowing limit to Rs 4.5 trillion

"The consent of the Members is sought for increasing the borrowing limit from Rs 3.5 trillion to Rs 4.5 trillion to cover the further requirement of borrowings," as per the AGM notice

State-run REC on Friday said it is seeking shareholders' approval to raise its overall borrowing limit Rs 4.5 lakh crore from the existing Rs 3.5 lakh crore.

The company's 51st annual general meeting (AGM) is scheduled to be held on September 25.

"The consent of the Members is sought for increasing the borrowing limit from Rs 3,50,000 crore to Rs 4,50,000 crore to cover the further requirement of borrowings," as per the AGM notice.

Current outstanding together with projected borrowings during 2020-21 is likely to exceed overall borrowing limit of Rs 3.5 lakh crore, the notice said.

The net amount of borrowings of the company as on March 31, 2020 was Rs 2,80,116 crore and a sum of Rs 1,10,000 crore is likely to be borrowed in 2020-21 for lending activities.

The borrowing will be done by way of issue of bonds to investors, availing long-term loans from banks and financial institutions, foreign currency borrowings, among others.

The company has also proposed to pass a special resolution for raising funds through private placement of unsecured/ secured non-convertible bonds /debentures of up to Rs 85,000 crore in one or more tranches.

The said limit of Rs 85,000 crore shall be within the overall revised borrowing limit being proposed for approval by the shareholders at the AGM, it added.