Rural Electrification Corporation Ltd. Bonds - Primary Issue

November 02, 2012

Sub.    :   Private Placement of Bonds by Rural Electrification Corporation Ltd.

  

REC – BACKGROUND

·         A Government of India (GoI) Enterprise incorporated on July 25, 1969 under the Companies Act, 1956, with networth of over Rs. 12,827.44 crore as on March 31, 2011. ·         Accorded “Navratna” status by GOI by virtue of its professional efficiency and financial strength, which affords greater operational freedom and autonomy in decision making. ·         Provides financial assistance to State Electricity Boards (SEBs), State Government Departments and Rural Electric Cooperatives for village electrification and energisation of pumpsets for increasing agricultural production and to other Center/ State utilities as also the private sector utilities. ·         Notified as a Public Financial Institution (PFI) u/s 4A of the Companies Act, 1956 in February 1992 and registered as NBFC u/s 45-IA of the RBI Act 1934 in February 1998. ·         Nodal agency for channelising finance to aid the GoI’s social and economic objective of achieving 100% rural electrification by 2012. ·         Consistent track record of timely servicing of debt.

  

REC – FINANCIAL HIGHLIGHTS                                                                                             (Rs. in crore)

As on/ For the year ended	March 31, 2008	March 31, 2009	March 31, 2010	March 31, 2011	March 31, 2012
Share Capital	858.66	858.66	987.46	987.46	987.46
Reserves (excl. reval. reserve)	4,245.36	5,334.56	10116.80	11839.98	13818.42
Net worth	5,104.02	6193.22	11104.26	12827.44	14805.88
Loans	39,316.51	44,935.96	66452.61	82132.06	-
Secured Loans	29,421.95	37,613.65	46244.74	46267.43	-
Unsecured Loans	4,860.84	7,322.30	9703.49	23736.39	-
Total Income	3,537.66	4,757.17	6549.76	8256.91	10337.59
Total Expenditure	2,224.67	3,014.19	4066.87	5033.04	6727.82
Profit Before Tax	1,312.99	1,922.36	2680.76	3499.16	3825.80
Profit After Tax	860.71	1,273.52	2022.25	2584.90	2838.66

  

INDICATIVE ISSUE Schedule

Issue Opening	Monday, November 05, 2012
Issue Closing	Wednesday, November 07, 2012
Pay-In Dates	Monday, November 05, 2012 to Wednesday, November 07, 2012
Deemed Date of Allotment	Monday, November 19, 2012

  

HIGHLIGHTS OF THE PROPOSED BONDS

Issue Size	Rs. 500 crore plus green shoe option to retain oversubscription
Instrument	Unsecured Redeemable Non-Convertible Non-Cumulative Taxable Bonds in the nature of Debentures (Series 111)
Instrument Form	In dematerialized form
Credit Rating	‘AAA/ Stable’ by CRISIL, ‘LAAA’ by ICRA, ‘CARE AAA’ by CARE and ‘AAA(ind)’ by FITCH
Face Value	Rs. 10,00,000/- per Bond
Issue Price	At par i.e. Rs. 10,00,000/- per Bond
Minimum Application	5 Bonds and in multiples of 1 Bond thereafter
Option	Option-III
Tenure	10 years
Put & Call Option	None
Redemption	At par at the end of 10th year from the Deemed Date of Allotment
Coupon Rate*	9.02%
Interest Payment	Annual
Listing	Proposed on the WDM Segment of National Stock Exchange of India Ltd. (NSE)
Trustee	IDBI Trusteeship Services Ltd.
Interest on Application Money *	At the respective cut-off coupon rate from the date of credit of application money in REC account  till one day prior to the Deemed Date of Allotment
Eligible Investors	Commercial Banks, Co-operative Banks, Urban Cooperative Banks and Regional Rural Banks, Financial Institutions, Companies, Body Corporate & Societies registered under the applicable laws in India and authorised to invest in bonds, Provident/ Superannuation/ Gratuity Funds and other Trusts authorised to invest in Bonds, Foreign Institutional Investors (FIIs) Insurance Companies, Mutual Funds etc.

* subject to deduction of tax at source, as applicable.