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SAIL plans to raise `5,000 crore debt in current fiscal year

Steel Authority of India plans to raise up to Rs 5,000 crore debt this fiscal by issuing secured non-convertible debentures or bonds in tranches to part-fund its capital expenditure.

‘A sum of Rs 9,000 crore is planned to be spent during the current financial year 2014-15. In order to part finance this expenditure, your company plans to borrow about Rs 5,000 crore during the year,’ SAIL said in a notice to shareholders ahead of the company’s annual general meeting. ‘On analysis of the various options of raising funds through borrowing in domestic and international markets, it has been decided by the Board of Directors to raise the funds through private placement of secured non-convertible bonds/ debenture to the extent of Rs 5,000 crore during the year,’ it added.

The state-owned steel maker is in the midst of expanding its crude steel production capacity to 21.40 million tonnes per annum (mtpa) from 12.84 mtpa earlier with Rs 72,000 crore investment. The investment also includes enhancing production from its captive mines. The expansion plan is being funded through a mix of debt and equity. SAIL had Rs 25,281 crore debt as on March-end this year.

The debt-equity ratio of the PSU steel maker, as on March-end, stood at 0.59:1 against 0.53:1 as on March-end of the previous year.
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