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City gas retailer Gujarat Gas Ltd has sought shareholders nod to raise borrowing limit of the company to Rs 15,000 crore from current Rs 10,000 crore to help meet fund requirement for its business expansion.
In a notice to shareholders, the firm said its 5th annual general meeting in 2017 had granted authority to the board of directors of the company to borrow money up to Rs 10,000 crore.
It now is seeking "the approval of the shareholders for enhancing the borrowing limits up to 15,000 crore (apart from temporary loans obtained from the company's bankers in the ordinary course of business) by way of a Special Resolution," Gujarat Gas said.
The resolution would be voted at the company's 7th annual general meeting (AGM) on September 20 in Gandhinagar, Gujarat.
The company said it is India's largest city gas distribution player with its presence spread across 23 districts in Gujarat, Union Territory of Dadra & Nagar Haveli and Thane in Maharashtra.
City gas distribution (CGD) business entails retailing compressed natural gas (CNG) to automobiles, and piping natural gas to household kitchens for cooking purpose. It also entails selling gas to industrial users for use as feedstock and as a source of fuel.
It has total 25 CGD licenses spread across 41 districts and six states and one Union territory, which accounts to 11 per cent of total CGD licenses and 10 per cent total authorized areas issued by oil regulator, Petroleum and Natural Gas Regulatory Board (PNGRB), and one transportation pipeline license.
It sells piped natural gas to more than 13.5 lakh residential consumers and over 12,300 commercial users. The company also dispenses CNG from 344 CNG stations to automobiles.
"In 10th CGD bidding round announced by PNGRB (earlier this year), the company has won 6 geographical areas or GAs comprising of 17 cities in the state of Punjab, Haryana, Madhya Pradesh and Rajasthan, making the company, a pan India company," it said.
Gujarat Gas said it has large CNG business expansion plans.
"Looking at the business expansion prospects, there is a requirement to have an enabling resolution on the borrowing limits to quickly cater to the future funding for infrastructure expansion.
"Under such circumstances, it is likely that the borrowings by the company may exceed the borrowing limits of Rs 10,000 crores, as approved by the shareholders in its 5th Annual General Meeting held on September 28, 2017," it said, seeking raising of the limit to Rs 15,000 crore.
It also sought shareholders approval to grant authority to the company board to determine the terms and conditions of any borrowings.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)