India Cements Plans Rs 100cr Debt Foray

The Rs 832.50 crore Chennai-based India Cements Ltd has decided to enter the debt market to raise Rs 100 crore with a greenshoe option of Rs 35 crore through the private placement route.

The company plans to raise resources by way of book building and has kept an indicative band of 13.25 to 13.75 per cent, payable annually.

The issue, rated as AA by CARE, is likely to give other companies, who plan to raise funds through the debt market, an indication of rates at which resources are available, said a merchant banker.

The issue is slated to open for subscription on November 12 and will close on November 24, while the cut off coupon rate will be announced on November 25.

SBI Capital Markets, IDBI Capital Markets and DSP Merrill Lynch are appointed as joint book runners for the issue.

The issue will be redeemed at par in four equal instalments at the end of third, fourth, fifth and sixth year of allotment. The issue will be offered at the face value of Rs 5 lakh and the minimum subscription is of five debentures.

The proceeds of the issue will be used by the company for part funding its various projects which include expansion of cement capacity through acquisition or investment, normal capital expenditure, setting up a capital power project, working capital requirements and normal corporate needs.