REC Limited, the distinguished Maharatna Central Public Sector Enterprise operating under the Ministry of Power, accomplished a remarkable feat in August 2023 by securing a substantial USD 1.15 Billion in loans. These loans, bearing a 5-year tenor, have been linked to the Overnight SOFR (Secured Overnight Financing Rate), serving as the standard benchmark for USD-denominated loans. The funds procured through this facility are earmarked for financing projects in the power, infrastructure, and logistics sectors, adhering to the ECB guidelines set forth by the Reserve Bank of India. This achievement aligns with REC’s ambitious Market Borrowing Programme, targeting Rs. 1.20 lakh crore for the fiscal year 2023-24.
The fund-raising effort comprised two tranches, orchestrated by a consortium of six banks serving as the Mandated Lead Arrangers and Bookrunners (MLABs). The initial tranche of USD 505 Million was raised on August 3, 2023, with the participation of Bank of Baroda, Gujarat International Fin Tec-City (GIFT City) IFSC Banking Unit (IBU); Axis Bank, GIFT City IBU; and State Bank of India, London Branch. Subsequently, the second tranche of USD 645 Million was secured on August 31, 2023, with contributions from State Bank of India, London Branch; Bank of India, GIFT City IBU; Bank of India, London Branch; and HSBC, GIFT City IBU.
Notably, both tranches combined garnered an impressive commitment of USD 550 Million from GIFT City IFSC Banking Units (IBUs). This achievement stands as the highest-ever commitment to REC from GIFT City IBUs within a single month, surpassing the previous record of USD 345 Million set in December 2021.
Chairman and Managing Director of REC Limited, Vivek Kumar Dewangan, commented on this significant milestone, stating, “REC has been actively exploring innovative options to diversify its sources of borrowing and reduce its borrowing costs. The successful closure of these two transactions in a single month underscores the strong financial position of REC Ltd. and its continued appeal to international lenders. We are pleased with the enthusiastic response from banks to these loans, marking our largest single-month fundraising from GIFT City IBUs. This further solidifies REC’s status as the leading PSU borrower in international markets during the current year.”
