Infrastructure Leasing and Financial Services Ltd (IL&FS) is planning to raise up to Rs5,000 crore through various group companies within the next six months, said Ramesh Bawa, IL&FS managing director.
“We will be doing it in tranches over the next few months through various entities in the group,” said Milind Patel, joint managing director, IL&FS Financial Services Ltd.
The firm also plans to issue $300 million worth of masala bonds by January, Bawa said.
Last month, the firm raised a Rs340 crore rupee-denominated loan, or masala loan, from international financial institution Export Development Canada (EDC). Masala bonds are Indian rupee-denominated bonds issued in offshore capital markets.
While announcing the development with the Canadian investor, Bawa said IL&FS plans to raise up to $700 million via an infrastructure investment trust (InVIT) of its road assets.
The group plans to raise the funds through a trust that will house four mature road assets, he had said. In March, Mint reported that IL&FS Transportation Networks Ltd (ITNL) had initiated the process of listing its road assets as an InvIT.
InvITs are trusts that manage income-generating infrastructure assets, typically offering investors regular yields and a liquid method of investing in infrastructure projects. Developers can use the long-term funds raised to unlock value in completed projects or repay debt associated with them.
InvITs received a much-needed push from the finance minister in this year’s budget when he announced that any distribution made out of the income of such trusts having a specified shareholding will not be subjected to the dividend distribution tax.
IL&FS held a 70.79% stake in ITNL as on 30 June.
ITNL has 30 road projects, of which 13 are operational and another five to six projects are likely to be operationalised in the next fiscal. The operational build-operate-transfer (BOT) projects are a mix of annuity and toll-based ones and are implemented through special purpose vehicles controlled by the company.
In 2014, the Securities and Exchange Board of India (Sebi) allowed Indian firms to launch real estate investment trusts and InvITs to help cash-strapped developers get easier access to funds, while also creating a new investment avenue for institutions and high net-worth individuals.
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Source: Mint