NTPC to raise $500 million through dollar bonds

NTPC, the country’s largest power producer, plans to tap foreign markets to raise as much as $500 million through dollar denominated bonds.

The proceeds are to be used to fund its plan to add 5,000 mw capacity next fiscal.

“We have discussed our plans with the investment bankers and will unveil the final details in the coming weeks. The initial plans are for $500 million but we may go for more depending on the interest rates at the time of raising funds,” said an NTPC official.

The company has big plans for its coal and gas based power plants and is also trying to acquire coal assets abroad.
NTPC has also asked the power ministry to facilitate raising funds through tax-free bonds in the country.

The finance ministry takes the final call on allowing government companies to raise funds through tax-free bonds.

“Though we are a cash rich company, our future cash requirement is very high. We need to exploit all possible sources to tap funds,” said the official.

The company, which has around Rs20,000 crore of cash reserves on its balance sheet, needs Rs25,000-30,000 crore per year and may look at raising money domestically or from overseas.