Unity Infra to raise Rs 150 cr to reduce High-Cost Debt

Unity Infraprojects plans to raise overseas loans and part sell stake in one of its projects to raise funds to refinance debt and hopes to reduce the interest rate by 300-350 basis points. As of last year, the rate of interest stands at 13.8-14% and as a result of it interest cost for the last year, was almost 4.5% of sales. The company’s consolidated debt stood at Rs 800 crore during FY11. Its sales stood at Rs 1,701.5 crore, up 15% on year. Net profit rose 10% to Rs 94.42 crore.

The company plans to raise external commercial borrowings (ECBs) of Rs 100-150 crore in the current fiscal to refinance debt. The company plans to induct private equity investment in its special purpose vehicle, which is developing six commercial properties in Nagpur on a build-operate transfer basis, with a concession period of 30 years. The company wants to reduce stake in the SPV to 26% from 50%.