GMR in talks with FIs for Rs 500 cr debt

INDIA INC ON A FUND-RAISING DRIVE

GMR Infrastructure, the Rs 1,700-crore flagship of the infrastructure major GMR group, is raising a debt of Rs 500 crore to fund its projects.

The company is holding talks with Indian banks and financial institutions to raise the money through the zero-coupon route.

A GMR spokesperson said: "We are evaluating all options for growth of the company. We will announce details of the fund raising when it is finalised."

A senior official of the company said the discussions with banks and FIs were at an advanced stage and the inflow might take place within this quarter. GMR Infrastructure, which is building the greenfield Hyderabad International Airport and revamping Delhi Airport, has a debt of Rs 120 crore and cash reserves of over Rs 1,200 crore.

The zero-coupon bond is a debt security that does not pay interest but is traded at a deep discount, rendering profit at maturity when the bond is redeemed for its full face value.

The Bangalore-based company is also into roads projects, costing Rs 2,700 crore. The company is putting in place capacities for generating 2,500 mw of power. GMR is also seeking opportunities in realty and transportation.

Following the deal, GMR Infrastructure will have a debt of Rs 620 crore at the company level. GMR Hyderabad International Airport, the arm which is developing a greenfield airport near Hyderabad, recently executed financial agreements for raising Rs 718 crore from Abu Dhabi Commercial Bank, Andhra Bank and Vijaya Bank. The money will be used to create additional facilities, common fuel farm and a business hotel in the airport.

While the rupee term loans of Rs 200 crore are being extended by Andhra Bank and Vijaya Bank, Abu Dhabi Commercial Bank will extend the remaining Rs 518 crore in dollars in the form of an external commercial borrowing (ECB).

The ECB has a repayment moratorium of two years from the date of airport's commercial operations (March 2008) and a structured payment pattern spread over 14 years thereafter.

GMR Infrastructure has a diversified asset portfolio with a mix of revenue streams, fixed returns, pure market driven returns and also a combination of fixed/market driven returns. The concessions range from 20 to 60 years with regular cash flows.

The company, which will announce its financial results by June-end, is expected to post a 60 per cent growth in top line in the range of Rs 1,600-1,700 crore and may double its net profit to around Rs 170 crore.

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Discussions with banks are at an advanced stage and the inflow might take place within this quarter

The company is expected to post a 60 per cent growth in top line