REC to raise additional Rs 50 billion via zero-coupon bonds

13 Nov 2024 CW Team

State-owned REC Ltd is planning to secure another Rs 50 billion in FY25 by issuing deep-discount zero-coupon bonds, according to sources. This follows its recent Rs 50 billion fundraising on September 30 through CBDT-notified zero-coupon bonds, which offered an effective yield of 6.25% per annum. The issue was oversubscribed by nearly seven times, with bids totaling Rs 336.7 billion against a Rs 50 billion offering, which included a base size of Rs 10 billion and a Rs 40 billion greenshoe option.

Zero-coupon bonds, issued at a deep discount and redeemed at face value, offer tax advantages with redemption classified as long-term capital gains, taxed at 12.5% due to the CBDT notification. Unlike regular bonds, they do not provide periodic interest, reducing reinvestment risk for investors.

REC also recently raised Rs 30 billion through 15-year bonds at 7.09%, marking the first long-tenure issuance by a ‘AAA’-rated entity in years, which attracted strong demand from insurers and pension funds. Additionally, it issued Rs 29.01 billion in 5-year bonds at 7.34%.

REC, a 'Maharatna' NBFC under India’s Ministry of Power, finances infrastructure projects nationwide. Separately, Indian Railway Finance Corporation (IRFC) is seeking Rs 30 billion in domestic bonds with a 15-year maturity, rated ‘AAA’ by Icra, Crisil, and Care.

(Business Standard)

Infrastructure Transport

01 Sep 2025

Indian Railways Marks New Milestone with 4.5 km Long ‘Rudrastra’ Trial

Indian Railways has successfully conducted the trial run of Asia’s longest freight train, named ‘Rudrastra’, achieving a new milestone in cargo transportation, as per news reports. The 4.5 km-long train began its trial from Ganjkhwaja railway station in Chandauli, Uttar Pradesh, and travelled to Garhwa in Jharkhand. Covering a distance of 209 km in 5 hours and 10 minutes, it maintained an average speed of 40.5 km per hour. The train was formed by combining three long-haul racks, with ..

UltraTech Launches India’s First On-Site Hybrid RTC Renewable Energy Project

UltraTech Cement has operationalised a 7.5 MW round-the-clock (RTC) hybrid renewable energy project at its Sewagram Cement Works in Gujarat. The first-of-its-kind solution combines bifacial solar modules with trackers, wind energy and battery storage, co-located on-site, to ensure uninterrupted power for cement manufacturing without grid reliance. The project was executed in collaboration with clean energy solutions provider Gentari. Installed as a behind-the-meter system, it is the country..

Patna Metro Trials Successful, Red Line Priority Corridor to Launch This Month

Patna is set to roll out its first metro rail service later this month, with successful trial runs conducted on the Red Line priority corridor, the Patna Metro Rail Corporation announced.On 7 September, a metro train completed a test run between the Patna depot and Bhootnath station. Officials said the trials involved rigorous checks of rolling stock fitness, overhead electrification (OHE), and track alignment and stability to ensure operational safety and performance.The corridor from the New Pataliputra Bus Terminal to Bhoothnath has been designated as the priority stretch and will be the fi..