New Delhi: L&T Infrastructure Finance Co has filed the draft prospectus for its proposed public issue of infra bonds, through which the non banking financial company expects to garner up to Rs450 crore.
L&T Infra is the second infrastructure finance company to file draft papers with the market regulator Sebi after IDFC. Merchant banking sources said L&T Infra would raise about Rs450 crore from the proposed bond issue.
The tax free infra bonds would have a lock in period of five years. The face value of the bonds would be Rs1,000 each and an investor would have to subscribe to a minimum of five bonds.
The funds raised through the bond issue will be utilized towards infrastructure lending, as per the draft paper filed.
SBI Capital Markets, JM Financial Consultants and ICICI Securities are acting as the lead managers to the issue.
L&T Infrastructure Finance, a wholly owned subsidiary of engineering giant Larsen & Toubro, got the infrastructure finance company (IFC) status from the RBI in July.
The firm is a non banking financial company (NBFC) and provides financial solutions for infrastructure development. It started operations in January 2007.
The bonds are proposed to be listed on the National Stock Exchange (NSE).
Incidentally, IDFC has launched the country’s first ever public issue of infrastructure bonds through which the lender expects to mop up Rs3,400 crore. The issue, that opened on Thursday closes on 18 October.
The IFCs can also issue tax-free bonds under Section 80CCF of the Income Tax Act, wherein an investor can avail a deduction of up to Rs20,000 in the taxable income for the current financial year.
The Rs20,000 deduction is over and above the Rs1 lakh deduction, under Section 80CC of the Income Tax Act.