PTC India Finance plans to raise $100 m via ECB route

Kolkata: Infrastructure finance company PTC India Financial Services is looking to raise $100 million in external commercial borrowing from India Infrastructure Finance Company (UK) Ltd.

The fundraising is expected to be completed by the end of January, PTC India Financial managing director Pawan Singh said.

This will be the company’s first overseas borrowing this fiscal.

“We expect to raise the debt at a sub 2 per cent rate. We are currently in talks with IIFC (UK) to finalise the terms,” Singh told ET. IIFC (UK) is a wholly-owned subsidiary of India Infrastructure Finance Company.

The overseas loan is aimed at diversifying the company’s fund resources while it already borrowed Rs 3600 crore from banks to take advantage of the falling interest rate, Singh said.

The company, which lends to power sector firms and entities in the energy value chain, will also be raising another Rs 600 crore from local sources by the end of the current fiscal, as part of its annual Rs 5000 crore borrowing plan.

Its average cost of borrowing stood at 7.62 per cent for the first half of FY22 with the net margin being at 3.98 per cent.

The publicly listed non-bank lender has raised its annual borrowing target by over 60% this fiscal to Rs 5,000 crore from less than Rs 2000 crore in the preceding fiscal. The company is chasing higher business targets in line with the government’s push to the renewable and sustainable energy sector.

The lender is looking to decouple itself from lending to thermal power projects with a target to reduce its exposure to the conventional power sector companies to less than 5% from around 10% of its total loans.

“We have fast evolved as a decarbonized company over the last three years,” Singh said.

Singh said that the company has set a target of giving sanctions worth Rs 7500 crore of loans with a disbursement target of Rs 5000 crore. In FY21, it had sanctioned loans worth Rs 4,000 crore and disbursed Rs 2647 crore.

Its outstanding loans, however, remained almost static at Rs 10,000 crore at the end of December in comparison to what it was at the end of FY21. “This is because of Rs 3,500 crore of loan prepayments,” Singh said.

He said that the company is trying to bring down the average loan asset maturity profile to reduce loan prepayments. Three years back, about 95 per cent of its lending was for more than 10 years. The ratio has now come down to 80 per cent.