After receiving a tepid response last year, Infrastructure Development Finance Company (IDFC) is all set to raise Rs 2,928 crore via the second tranche of its infrastructure bonds.
Offering a coupon rate of eight per cent, IDFC’s infrastructure bond issue would remain open from January 17 to February 4. The issue is in two series and is being offered in multiples of Rs 5,000, with maturity of 10 years. Both the series will have a buyback option after five years. The issue has received credit ratings of ‘LAAA’ by Icra and ‘AAA’ by Fitch.
In its first attempt, IDFC was able to garner just Rs 471 crore, as against the target of Rs 700 crore. This was so even after the closing date was extended till the next month. In all, the company can raise Rs 3,400 crore in multiple tranches this financial year.
However, this time around, the company can expect a better response. “This being the last quarter, people tend to invest in tax saving instruments. Thus, it is the right time to come up with an infra bond issue,” said an advisor with a brokerage firm. Investment up to Rs 20,000 in infrastructure bonds is exempted from tax.