''IDFC may raise USD 500 million through another ECB borrowing''

Hyderabad, Jan 24 (PTI) Infrastructure DevelopmentFinance Corporation (IDFC), which raised USD 300 millionearlier through external commercial borrowings (ECB), mayraise another USD 500 million in the next round, a top companyofficial said today.

According to S J Balesh, senior director (Treasury), IDFCis entitled to raise up to USD 1.2 billion as per the networth of the company.

"As per RBI guidelines, any corporate is entitled toraise USD 500 million through ECB in a fiscal. We may raisethat before March or after March depending upon the marketcondition. It is a continuous process. We are eligible toraise USD 1.2 billion as per our net worth which is Rs 11,000crore (USD 2.4 billion)," he said in a press conference here.

Balesh said so far they raised USD 300 million in 2006and are eligible to raise another USD 800 million as per ECBnorms.

To a query, he said IDFC, which aims to mop up Rs 3,400crore through its maiden retail bond issue, raised Rs 436crore from the first tranche, which closed on October 25.

"IDFC got a record around 2.5 lakh applications for thefirst tranche and we expect similar kind of response this timealso. We hope since this is last quarter of the financialyear, people may prefer this for tax saving purpose," he said.

In February, the Reserve Bank created a separate entityunder the classification of NBFC - Infrastructure FinanceCompanies (IFCs).

These IFCs can also issue tax-free bonds under Section80CCF of the Income Tax Act, wherein an investor can avail adeduction of up to Rs 20,000 in the taxable income for thecurrent financial year.

The Rs 20,000 deduction is over and above the Rs one lakhdeduction, under Section 80CC of the Income Tax Act.