NHAI Ties Up ` 40 Billion Through Bond Issue

The National Highways Authority of India has started the process to raise about Rs 40 billion through a bond issue in the domestic market, the process for which has already begun with the selection of lead bankers, including Axis Bank and SBI Caps.
If retail investors will also be eligible to participate in the bond issue is yet to be finalised even as the road minister, Nitin Gadkari, recently said that they should invest in NHAI bonds to get greater returns. The bond issue is part of the fund raising exercise of the NHAI, which recently signed a loan agreement with the State Bank of India for unsecured loan worth ` 250 billion. The loan agreement is for 10 years with three years in moratorium on repayments, the largest amount of loan to have been sanctioned to NHAI in one stroke by any institution and the lowest rate of 7.9%.
The funds raised from these initiatives would be utilized towards project execution as the NHAI plans to award 20,000 km of projects and construct over 16,000 km during the current year, of which 9,700 km will be constructed by the Road Ministry and 6,000 km by the NHAI.