Rural Electrification Corp. (RECL), an Indian state-controlled lender to power projects, plans to boost borrowing by 74 percent in the year starting April 1.
The company, based in New Delhi, plans to raise 300 billion rupees ($5.9 billion) selling bonds and loans, Finance Director Hari Das Khunteta said in a telephone interview today. Proceeds from the borrowings will be used to fund power projects in the South Asian nation, he said.
Prime Minister Manmohan Singh plans to double investment in building power plants, roads and ports to $1 trillion by 2017 to boost growth in Asia’s third-largest economy. India expanded 6.1 percent in the three months ended Dec. 31, the slowest pace in almost three years
“Electricity generation will be key for the economy to grow at a 9 percent rate,” said Saibal Ghosh, chief investment officer at Aegon Religare Life Insurance Co.
Shares of the 44 year-old company fell 0.9 percent to 201.85 rupees in Mumbai. They have risen 31 percent this year exceeding the 12 percent advance in the benchmark Sensex index.
Rural Electrification raised $3.4 billion of debt in 2011, compared with $2.15 billion in 2010, according to data compiled by Bloomberg. The company, India’s fifth-most indebted company, has $12.5 billion of debt due by 2025, the data show.
The company raised 18 billion rupees selling rupee- denominated bonds this quarter. It raised 200 million Swiss francs ($219 million) in bonds denominated in the Alpine nation’s currency. It also got $150 million of yen-denominated loans.
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