Irfc Gets Rs 400cr In Lease Finance

Finance worth Rs 250 crore has been tied up with the Industrial Credit & Investment Corporation of India (ICICI) and Rs 150 crore with the Industrial Development Bank of India (IDBI).

Agreements in this regard have already been signed.

Indian Railway Finance Corporation has for the first time taken the lease finance route to raise funds for rolling stock procurement.

The railway ministry has given the corporation a mandate to mobilise Rs 1,850 crore in the current financial year to part-finance the plan outlay of Rs 8,130 crore.

Finance for rolling stock procurement was hitherto being mobilised by tapping the bond market.

But the response to bond issues has been lukewarm in recent years.

This year however saw a turnaround in fortunes with the Rs 400 crore bond issue of the corporation receiving an oversubscription of Rs 80 crore, which has been retained by the company.

The good response to the bond issue, coupled with the success in tying up lease finance, has raised hopes that the Indian Railway Finance Corporation will meet its fund mobilisation target for the current year.

Indian Railway Finance Corporation managing director N P Shrivastava considers it a major achievement and is confident that the corporation will meet the resource mobilisation target of Rs 1,850 crore well within the current financial year.

Shrivastava told Business Standard that the corporation wanted to arrange lease finance worth Rs 600 crore.

While Rs 400 crore has already been tied up, the corporation is trying to procure the remaining Rs 200 crore from the State Bank of India.

Negotiations with the State Bank are in an advanced stage, Shrivastava added.

State Bank of India is syndicating the money through its subsidiaries.