REC to enter capital market

Chennai, Feb 15 (UNI) Public sector Rural Electrification Corporation Limited (REC), a leading public financial institution in Indian power infrastructure, is entering the capital market with a public issue of 156,120,000 equity shares to augment its capital base.

Addressing a press conference here, REC Director (Finance) K D Khutiteta said the price band of the issue, which opens on February 19, was fixed at Rs 90 to Rs 105 per equity share of Rs 10 each, through 100 per cent book building process. The issue would close on February 22.

The company proposed to utilise the net proceeds of the fresh issue (78,060,000) to augment its capital base to meet future capital requirements, arising out of growth in its assets.

''The REC is seeking to strengthen its capital base to improve borrowing capacity in order to support future growth in its assets.'' REC is one of the leading public financial institutions in Indian power infrastructure, engaged in the financing and promotion of transmission, distribution and generation of projects throughout the country.

''The company is entering the capital market, amid turmoil in the market as it was fundamentally strong. Its networth is strong and the cost of fund is cheap,'' he added.

UNI WS JJ 1518