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HUDCO to raise up to Rs 1,711 crore via tax free bonds

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New Delhi :State-owned HUDCO today said it plans to raise up to Rs 1,711 crore through issue of tax free bonds mainly to finance the projects related to housing for EWS/LIG categories.

Housing and Urban Development Corporation (HUDCO) is issuing tax free bonds with a face value of Rs 1,000 each in the nature of tax free, secured, redeemable, non-convertible debentures, aggregating to Rs 500 crore, with an option to retain over-subscription up to Rs 1,211.50 crore, aggregating up to Rs 1,711.50 crore.

“The issue will open for subscription on January 27, 2016 and is scheduled to close on February 10, 2016 with an option for early closure. The bonds under the issue are proposed to be listed on the BSE,” HUDCO said in a statement.

The interest income on bonds is exempted from levy of income tax in the hands of the investors.

“The funds raised through this Issue will be utilised to finance the projects and activities mainly relating to housing for EWS/LIG categories during the current year and over the years and for such other purposes as may be permitted by Ministry of Finance or any other authority, from time to time,” it added.

For the bondholders falling under Category I, II and III (QIBs, Corporates and HNIs), the bonds would carry interest at the coupon rate of 7.02 per cent per annum and 7.39 per cent per annum, for a tenor of 10 years and 15 years, respectively.

For bondholders falling under Category IV (retail individual investors investing up to Rs 10 lakh), the bonds would carry interest at the coupon rate of 7.27 per cent per annum and 7.64 per cent per annum, for a tenor of 10 years and 15 years, respectively.

HUDCO is a techno-financial institution engaged in the financing and promotion of housing and urban infrastructure projects throughout the country.

PTI

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