Realty major DLF plans to borrow Rs 1,000 crore through non-convertible debentures (NCD) by the end of this month.
The company will primarily use the money to retire its high cost debt. An NCD is debt given to a company that carries no option to convert it back into equity.
“The NCDs will be issued for three years at an interest rate of 10.5 per cent. Axis Bank will carry on the process of issuing debentures and raising money for us,” said Saurabh Chawla, executive director (finance) of DLF.
As of December 2009, the company had a net debt of around Rs 12,800 crore.
Managing debt is a priority for the company. In its results for the October-December 2009 period, the company said that it wants to keep improving the tenure and quality of debt.