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IRFC hopeful of raising Rs 1,000 crore from capital gains bonds

BHUBANESWAR: Indian Railway Finance Corporation (IRFC) is ho..

BHUBANESWAR: Indian Railway Finance Corporation (IRFC) is hopeful of raising Rs 1,000 crore from the recent issue of capital gains bonds, its Managing Director S K Pattanayak said today.

With an aim to raise Rs 500 crore with the green shoe option to retain over-subscription, IRFC is looking at mopping up Rs 1,000 crore from the capital gains bonds, he told PTI here.

Stating that IRFC opened the issue on November 10, Pattanayak said the bonds have a lock-in period of three years and presently yields an interest of 5.25 per cent per annum, payable on October 15 every year.

The bonds have benefits under Section 54EC of the Income Tax Act, 1961, he said.

IRFC is among the four institutions authorised by the Union Finance Ministry to issue such bonds. The other three non-banking financial companies are NHAI, REC and PFC.

"The IRFC bonds are safe, secure, redeemable and non-transferable, and are a cheap source of funding for us," the managing director said, adding, that a person who has received capital gains in a year can invest in these bonds and save tax on capital gains.

An investor can invest a minimum of Rs 20,000, and in multiples of Rs 10,000 thereafter, with a maximum of up to Rs 50 lakh in these bonds, during a financial year.

Noting that IRFC is one among the five Railway PSUs selected for listing on the bourses, Pattanayak, who was on a visit here, said preparations were underway in that direction.

Since its inception in 1986, IRFC has been playing a significant role in supporting the expansion of the Indian Railways, meeting about 30 per cent of its extra budgetary requirements, he said.
The amount is around Rs 40,000 crore during this fiscal.

Stating that the Railways has a big investment plan of Rs 8.56 lakh crore from 2015-16 to 2019-20, Pattanayak said said the target of funding through IRFC has been pegged at Rs 2.50 lakh crore.

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