State-run Rural Electrification Corp (REC) has decided to raise up to Rs 4,500 crore through tax-free bonds in the current fiscal. The issue opens for subscription on December 3, 2012 and closes on December 10, 2012. The issue proceeds will be utilized for normal lending operations of REC in the power sector and infrastructure projects to augment resource base of the company.
The minimum application for subscription in retail segment is of Rs 5,000 with an upper limit of Rs 10 lakh, 40 per cent of the issue is reserved for retail participation. Though, the coupon rates of these instruments are yet to be announced but QIB, HNI and Corporates are likely to earn 50 basis points less return compared to retail investors.
REC is engaged in providing financial assistance to state electricity boards, state government departments and rural electric co-operatives for rural electrification projects as are sponsored by them.
