Indian Rail Finance Corporation (IRFC), the financial arm of Indian Railways, will raise Rs 9,120 crore in 2010-11 to part-fund the planned Rs 41,426-crore investment for the Indian Railways.
“We are confident of raising that amount in 2010-11,” said a senior IRFC official. “The money has been raised through a mix of loans, tax-free bonds and taxable bonds. We have raised close to what we had to raise for 2009-10 and will raise the full Rs 9,170 crore before March 31, 2009.”
While the 5-year tax-free bonds in 2009-10 offered a rate of 6 per cent, the 10-year bonds offered 6.75 per cent. “The rate for bonds for the next financial year will depend on market conditions,” said the official.
“The bonds are attractive because there are very few instruments that are safe but investors will have to check the returns,” said Surya Bhatia, a Delhi-based financial planner.