Brief Introduction of the company
Ø Financing arm of the Indian Railways, notified as a Public Financial Institution under Section 4A of the Companies Act, 1956.
Ø Registered as a NBFC-ND-IFC (Infrastructure Finance Company) with Reserve Bank of India. 100% shareholding held by Government of India. Consistently profit making Public Sector Undertaking. Consistently rated 'AAA' by CRISIL, ICRA and CARE
Ø Impeccable track record of funding rolling stock asset creation worth Rs. 60,163 crore (5,060 locomotives, 32,115 passenger coaches and 1,39,659 freight cars) for Indian Railways so far, besides providing funding support of Rs. 2,294 crore to other Railway entities such as Rail Vikas Nigam Ltd., Rail Tel Corporation of India Ltd. Etc
Ø Networth as on September 30, 2011 is Rs 4487.49 crores. Net Profit after Tax as on September 30, 2011 is 201.52 crores and it stood at Rs.485.20 crores for year ended March 31, 2011 compared to Rs 442.69 crore in March 31, 2010.
Issue details:
| Issuer | Indian Railway Finance Corporation Limited |
| Issue of Bonds | Secured, Redeemable, Non-Convertible bonds in the nature of debentures, having benefits under section 10(15)(iv)(h) of the Income Tax Act, 1961 |
| Issue Size | Rs 3,000 crores with an option to retain oversubscription up to ` 6,300 crores (Shelf-limit) |
| Issue Open Date | 27th January, 2012 |
| Issue Closing Date | 10th February, 2012 |
| Face Value (Rs.) | ` 1,000 per Bond |
| Minimum Application | ` 10000 (10 Bonds) & in multiples of ` 5000 (5 Bonds) |
| Tenor/Redemption Date | 10 Years and 15 Years from the deemed date of allotment |
| Ratings | "CRISIL AAA/Stable" by CRISIL, "CARE AAA" by CARE & "ICRA AAA" by ICRA |
| Security | Charge on the movable assets comprising of rolling stock such as wagons, locomotives and coaches by way of first/ pari passu charge, present and future, as may be agreed between IRFC and the Trustee, pursuant to the terms of the Debenture Trust Deed |
| Trading | Compulsorily in dematerialized form |
| Issuance | In dematerialized form as well as physical form, at the option of Applicants. |
| Lead Managers | A. K. Capital Services Ltd., SBI Capital Markets Ltd. & ICICI Securities Ltd. |
| Depository | National Securities Depository Ltd. and Central Depository Services (India) Ltd |
| Trustee | Indian Bank |
| Allocation | Category I (QIB+ Corporate)- up to 45% Category II (Individual above 5 Lakhs)- up to 25% Category III (Individual below 5 Lakhs)- up to 30% |
| Listing | Proposed to be listed on BSE & NSE |
| Interest on Application Money used towards allotment of bonds | @ 8.00% p.a. on the amount for which Bonds are allotted to the Applicants subject to deduction of income tax under the provisions of the Income Tax Act, 1961, as amended, from the date of realization of the cheque(s)/ demand draft(s) or 3 (three) days from the date of banking of the application (being the date of submission of each application as duly acknowledged by the Bankers to the Issue) whichever is later, upto one day prior to the Deemed Date of Allotment |
| Interest on Application Money which is liable to be refunded | @ 4.00% p.a. on application money that is liable to be refunded to the Applicants in accordance with the provisions of the SEBI Debt Regulations, or other applicable statutory and/or regulatory requirements, subject to deduction of income tax under the provisions of the Income Tax Act, 1961, as amended, from the date of realization of the cheque(s)/ demand draft(s) or 3 (three) days from the date of receipt of the application (being the date of presentation of each application as acknowledged by the Bankers to the Issue) whichever is later, upto one day prior to the Deemed Date of Allotment. Provided that IRFC shall not be liable to pay any interest on monies liable to be refunded in case of (a) invalid applications or applications liable to be rejected, and/or (b) applications which are withdrawn by the applicant. |
Issue Closing date - 10 Feb 2012
The bonds will be listed on the BSE.
| Options | I | II |
| Tenor | 10 Years | 15 Years |
| Face Value(Rs./Bond) | `1,000.00 | `1,000.00 |
| Minimum Application Size | ` 10000 or 10 Bonds | ` 10000 or 10 Bonds |
| In Multiples of | ` 5000 or 5 Bonds | ` 5000 or 5 Bonds |
| Coupon Rate (%)p.a. |
| Retail (Category III) | 8.15%* | 8.30%* |
| Others (Category I & II) | 8.00% | 8.10% |
| Interest Payment | Annually | Annually |
| Interest Payment Date | October 15, every year | October 15, every year |
| Redemption Date | 10 Years from the Deemed Date of Allotment | 15 Years from the Deemed Date of Allotment |
| Maturity Amount | Face Value + Interest Accrued at the Redemption Date | Face Value + Interest Accrued at the Redemption Date |
Highlights of Tax Benefits
Ø The income by way of interest on these Bonds is fully exempt from Income Tax and shall not form part of Total Income as per provisions under section 10 (15) (iv) (h) of IT Act.
Ø There will be no deduction of tax at source from the interest, which accrues to the bondholders on these bonds irrespective of the amount of the interest or the status of the investors.
Ø Wealth Tax is not levied on investment in Bonds under section 2(ea) of the Wealth-tax Act, 1957.
