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Showing posts with label IRFC. Show all posts
Showing posts with label IRFC. Show all posts

Monday, 28 December 2020

07:10

Indian Railways HRMS will lead to Employee Productivity and Administration Efficiency

Indian Railways HRMS will lead to Employee Productivity and Administration Efficiency

Reforms in HR Management 

Management System (HRMS) :- In 2020, the HRMS has been put into application and is being used extensively by Railway employees. As HRMS aims to bring all HR activities on a digital platform, it is a game changer in HR Management of Indian Railways and will lead to employee productivity and administrative efficiency simultaneously. In 2020, we have launched various modules of HRMS such as e-Pass, Office Order modules, Employee self-service, Executive record sheet for Officers, PF & Settlement, besides Employee Master and e-SR which were launched during late 2019.

Financial Reforms 

a.IRFC and MOR have executed a facility agreement with Asian Development Bank (ADB) for loan facility denominated in INR equivalent to USD 750 Million (about Rs.5,267 crore) for Railway electrification projects.

b.IRFC constantly diversifies its borrowing portfolio to arrange funds for Indian Railways, at the most competitive rates and terms. IRFC upgraded its Euro Medium Term Note (EMTN) programme to Global Medium-Term Note (GMTN) Programme which facilitated its maiden issuance of bonds under 144A / Reg S route. The bonds under the GMTN Programme were issued in two tranches of USD 700 Million and USD 300 Million with tenor of 10 years and 30 years carrying coupon of 3.249% (Benchmark US Treasury plus 160 bps) and 3.95% (Benchmark US Treasury plus 184 bps) respectively. The coupon obtained by IRFC is the lowest amongst the issuances, during 2020. Besides, the 30-year issuance is the maiden issue by an Indian CPSE.

c. A Miscellaneous E-Receipts System (MERS) portal has been developed by CRIS to facilitate digital payments of inward receipts to Railways. The scheme has been rolled out on all Indian Railways and the operational guidelines have been issued in June,2020 . The portal is fully integrated with Land Assets Management System (LAMS) of the Engineering Department. This has enabled Railways to receive lease charges, way leave charges on a digital platform. Functionalities have also been developed in MERS to accept online payments from Railway customers for ‘Special COVID -19 Parcel Trains’ after approval from Commercial Authorities.  This would be line with Government initiative of encouraging digital payments and would introduce faster and transparent accounting of receipts.

d.Implementation of E-PPO scheme:  In order to curtail delays in physical transmission of Pension Payment Orders to the pension disbursing banks, a scheme of e-PPO has been put in place wherein the PPOs are being forwarded to the banks system through SFTP mode which obviates the delays in physical transit of the PPOs.  A new version (revised methodology of digital signing) of E-PPO has been implemented on IPAS. As per new version of e-PPO, CRIS will push encrypted E-PPO File (Zipped) in respective Centralised Pension Processing Centres (CPPC) folders of the Bank's server. Banks can act upon these E-PPOs without waiting for physical copies. This system ensures commencement of pension from next month of retirement.

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Monday, 10 February 2020

08:20

Cleft Lip and Palate Surgery Camp Organised at Central Hospital Under Mission Smile

Cleft Lip and Palate Surgery Camp Organised at Central Hospital Under Mission Smile

CLEFT LIP AND PALATE SURGERY CAMP ORGANISED AT SER CENTRAL HOSPITAL UNDER ‘’MISSION SMILE’’
Kolkata, 7th February, 2020:
South Eastern Railway in assistance with Indian Railway Finance Corporation (IRFC) is organizing a Free Cleft Lip & Cleft Palate Surgery Camp for the children who are born cleft & to repair their common birth defects at South Eastern Railway Central Hospital, Garden Reach from 7th to 10th February, 2020 under “Mission Smile”, a Medical Charitable Trust active for this kind of surgeries. This is the 11th‘Mission Smile’ camp in this hospital and the 108th in the country.
Sri Sanjay Kumar Mohanty, General Manager, South Eastern Railway inaugurated the Surgery Camp in presence of a group of expert doctors , paramedical staff, trained nurses and volunteers from all over theworld. Dr. B K Sethi, Principal Chief Medical Director, South Eastern Railway and other Senior Doctors and Principal Officers attended the programme. Dr. Anjana Malhotra, Additional Chief Health Director and an eminent Plastic Surgeon of SER Central Hospital has taken the lead to success this noble cause. This apart, a team of experts from the field of Plastic Surgery, Oral and Maxillofacial Surgery, Anesthesiology, Pediatrics, Dentists, Speech Language, Pathology etc. are actively participating to help the mission.
General Manager, South Eastern Railway while inaugurating the surgery camp thanked the team of doctors and volunteers associated with “Mission Smile” for making such noble act a great success. General Manager also said that South Eastern Railway Central Hospital has been fostering this kind of humanitarian programme in collaboration with “Mission Smile” for last few years and will extend all sorts of help in coming days too.
As many as 150 patients were screened for operation, out of which, 120 patients would be undertaken for Cleft Lip and Cleft Palate Surgeries to bring the children in normal life without any deformity. Children born with cleft lip and cleft palate are facing a number of emotional and social difficulties both for parents and children. Cleft lip and palate repair is being performed to improve the child patients ability to speak and hear properly and the children feel more comfortable with their appearance.
South Eastern Railway Central Hospital, Garden Reach, Kolkata is a premier 303 bed, multidisciplinary, multi-specialty tertiary care centre. This is not o­nly a Zonal Referral Hospital but also a referral centre for the Eastern Railway, Metro Railway, North East Frontier Railway and East Central Railway in certain specialties. This Hospital is rendering all sorts of support for organizing such benevolent camp year after year for better causes.
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Sunday, 19 March 2017

18:21

Railways seek reimbursement for IRCTC service charge waiver

Railways seek reimbursement for IRCTC service charge waiver

IRCTC used to charge Rs 40 per ticket for bookings in AC classes, Rs 20 per ticket in sleeper class

With the finance ministry starting the process for listing of Indian Railway Catering and Tourism Corporation (IRCTC), Indian Railway Finance Corporation (IRFC) and Ircon International (Ircon), the loss of service charge for IRCTC has become a cause for concern for railway officials.

The government waived the service charge following demonetisation to encourage cashless transactions.

The railway ministry has written to the finance ministry seeking reimbursement of the loss amounting to over Rs 500 crore on an annualised basis. IRCTC shares half of this service charge revenue with the railways. Officials said the process for appointment of merchant bankers was under way with ICICI Securities and IDFC making presentations. The Department of Public Asset Management has set March 16 as the final date for submission of requests for quotations in this regard. 

The decision to list these companies came as a surprise to the railways when Finance Minister Arun Jaitley made the announcement in his budget speech last month. The railways had written to the finance ministry on the issue of service charge before the budget as well. When asked about the letters for reimbursement of service charge, BB Verma, the new railway financial commissioner, said, “We are expecting a good valuation for all three  companies. However, the waiver of service charge is a cause for concern as it may affect revenue of about ~500 crore for IRCTC annually.”  

IRCTC used to charge Rs 40 per ticket for bookings in air-conditioned classes and Rs 20 per ticket in sleeper class. In 2015-16, railway ticketing generated Rs 551 crore in income for IRCTC, up 115 per cent from Rs 256 crore in 2014-15. “We expect the finance ministry to do something about this and have written to them in this regard. On a monthly basis, the revenue for IRCTC from the service charge comes to an average of Rs 40 crore, of which about Rs 20 crore is the share of the railways,” said Mohammed Jamshed, member (traffic) of the railways. 

The listing of railway PSUs will also mean that the railway ministry’s plan to set up a holding company for all public sector enterprises under its charge will be shelved. A draft Cabinet note with this proposal was earlier circulated among relevant ministries.  The plan included bringing 13 railway PSUs, including Bharat Wagon & Engineering Company, Container Corporation of India, Ircon, IRCTC, Konkan Railway Corporation, Mumbai Railway Vikas Corporation, Rail Vikas Nigam, Railtel Corporation of India, RITES, Dedicated Freight Corridor Corporation of India, Burn Standard Company and Braithwaite & Company and Kolkata Metro Rail Corporation, under one holding company. 

Only Container Corporation of India is listed. “IRFC and Ircon have huge potential. The AAA rating that IRFC gets from credit rating agencies is proof of this. Listing will not affect its ability to raise money as the government will still provide sovereign guarantee,” Verma added.

In 2017-18, the railways plan to raise about Rs 22,000 crore through IRFC bonds. 

Cause of concern:
* The railway ministry has written to the finance ministry seeking reimbursement of the loss amounting to over Rs 500 crore on an annualised basis
* IRCTC used to charge Rs 40 per ticket for air-conditioned class and Rs 20 per ticket for sleeper- class bookings prior to demonetisation
* The government waived the service charge following note ban to encourage cashless transactions
* In 2015-16, the share of railway ticketing in IRCTC’s revenue stood at Rs 551 crore, up over 115 per cent from Rs 256 crore in 2014-15    

 Source:Business Standard



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Sunday, 8 May 2016

17:13

Railways deprived of cheapest & best form of Funding for healthy business growth

Railways deprived of cheapest & best form of Funding for healthy business growth

Where is the surplus to service the railways’ debt?

The Union railway minister, Suresh Prabhu, has drawn the attention of Parliament to the substantial rise in capital expenditure that will have taken place by the end of the current financial year. This is needed not just to renew ageing assets to ensure safety but also to raise capacity and grow. The issue is: Where is this money coming from and the way things are, can the railways service such expenditure? While the Union finance ministry has been generous with budgetary support, the really rapid rise will be in financing through extra-budgetary resources, typically bonds floated by the Indian Railway Finance Corporation. The former is relatively cheap money (less than three per cent) but uncertain, as it is dependent on the government’s fiscal situation. IRFC funding, on the other hand, is costly (8.4 per cent in 2013-14) and makes it incumbent upon the railways to achieve a healthy margin in its operations. It is here that the railways will have to seriously address the exceptionally high operating ratio (working expenses to traffic earnings) of 90 per cent for 2015-16, which indicates that very little surplus is generated from operations. So the national carrier is deprived of what is the cheapest and best form of funding for healthy business growth — internal resources. The medium term trends revealed in the recently tabled CAG’s report on the railways for 2014-15 are illuminating. Virtually the entire surplus (97 per cent) generated by freight operations goes to meet the deficit in passenger services. Every class of passenger travel, except three-tier AC, loses money. The report expectedly recommends that passenger fares should be raised. However, the total number of passengers carried in the last three years has not just plateaued but fallen, even as passenger revenue has gone up. If fares are raised further, more passengers are likely to keep walking away until revenue starts getting affected. The story is the same in terms of the scope for raising freight rates, with the railways continuing to lose market share. If the scope for improving margins by raising tariffs is severely limited, there is only one way to go – reduce costs by improving efficiencies. The railways ability to carry out internal reforms (they improve efficiencies) is thus vital for its healthy survival and growth. The CAG’s report narrates the fate of one operation, recasting the railways financial statements along commercial lines. This, among other things, will indicate if the bottom line, net profit or revenue, is realistic after providing enough for depreciation. Started a decade ago with the assistance from the Asian Development Bank and a timeline of 30 months, the process is yet to be completed. What is worse, the CAG’s department could not even get a reply from the railways to its query last year asking for the current status of the exercise. There is another area that cries for reform. Today, when every business is frantically going digital, it is imperative for the railways to publish a white paper detailing its digital road map. The level of computerisation already achieved should enable the railways to go in for vastly greater data analysis and differentiated pricing based on seasonality and geographical pattern of demand. This will enable more sophisticated incentive pricing. There also cannot be any further delay in reorganising the railway board so as to have members dedicated to customer segments and an independent pricing authority which will take the politics out of fixing fares and freight rates.

Source:RailNews


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Friday, 11 March 2016

06:30

IRFC’s Tax-free Bonds Oversold Four Times higher than planned

IRFC’s Tax-free Bonds Oversold Four Times higher than planned

Mumbai: Indian Railways Finance Corporation’s tax-free bonds were oversold, almost four times higher than it had planned. With this, the issuer marked the season’s end although the issue would remain open for subscription till Monday next as the retail portion is not fully subscribed.

The company on Thursday received bids for Rs 9,452 crore against Rs 2,450 crore, the total issue size.

However, the retail portion, which was 60% of the size, was not fully subscribed, and limited to 0.72 times till Thursday.

Earlier on Wednesday, another state-owned entity National Bank for Agriculture and Rural Development opened similar tax-free bond subscription but only to raise Rs 3,500 crore. It has so far received bids for Rs 14,072 crore, four times higher than the actual size. But, it too fell short of retail subscriptions, which are now at 0.82 times of the investment limit.

Both bonds are offering rates at 7.29-7.64% with 10 and 15-year maturities.

“The residual retail limits would be over by next few days as the issue remains open,” said Ajay Manglunia, executive vice president-fixed income at Edelweiss Finance. “There’s no ebbing of investor interest. It is just that some equity investment options have taken away some retail money.”

For instance, the government sold 5% stake in Container Corporation of India (Concor) through the Offer for Sale route. It too has oversubscribed tapping retail money. Also, investors are partially flocking back to equities with the Sensex rising since the budget announcements.

“Residual retail limits do not suggest any ebbing of invest appetite but a question of temporary liquidity matter amid the government’s disinvestment plans,” said Deepak Panjwani, head of debt markets at GEPL Capital.

The government allowed the additional fund raising on condition that a higher portion of the issue is set aside for retail investors, who can buy up to 60% of these bonds compared with 40%  in earlier issues sold this financial year.

Source:RailNews
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Tuesday, 15 December 2015

18:12

Indian Railways to raise Rs.2000 Crore from Offshore Rupee Bond

Indian Railways to raise Rs.2000 Crore from Offshore Rupee Bond

New Delhi: For the first time, the finance arm of world’s largest railway network, Indian Railway Finance Corporation (IRFC) will list offshore rupee denominated bonds in the London Stock Exchange to raise 200 million dollar to 300 million dollar (approx. Rs 2,000 crore) to fund its modernization plans. “The exact date for the launch of the bond has not yet been decided but it is likely to get listed in the first month of the new year after Prime Minister Narendra Modi, in his Wembley address in London, set the tone for its listing in world’s premier exchange”, an official source said.

According to the official, IRFC will issue rupee denominated offshore bonds of five year tenure. The technical bids for the same would start from November 5 and will be finalized on November 20. IRFC has identified 66 prospective lenders. Railway Minister Suresh Prabhu, during his visit to United Kingdom last month, met investors at London Stock Exchange to gauge the market sentiment over the rupee bonds.

Mr Prabhu had interaction with various investors which included Standard Life, Citibank, SBI UK, SBI Caps UK, Prime Bridge Investments, London Stock Exchange, Standard Chartered Bank, ANZ bank, HSBC bank, Kotak Mahindra. Notably, Mr Modi in his speech to a gathering of 55,000 people at Wembley stadium had said “after James Bond, Brook Bond now it’s the time of rupee bond”, setting the stage for launch of the offshore bond which is aimed at borrowing money from world markets to fast track the modernization plans of world’s largest rail network. In the railway budget 2015-16, Mr Prabhu had proposed to rope in private sector to modernise stations Banks, pension funds keen to invest in Railways and set a target of 8.5 lakh crore investment in Railways in the next 5 years.

There are currently 55 Indian or India-focused companies quoted on London’s markets in addition to 26 Indian Global Depository Receipts listed on London’s International Order Book. In 2014, the total value of Indian GDR trading on IOB was 6.23 billion dollars. Indian companies have raised equity capital worth 8.1 billion dollar in London. London Stock Exchange has seen 27 rupee or Masala bonds listed in total on its markets (12 currently active) that have raised GBP equivalent of 2.85 billion pounds.
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Wednesday, 25 November 2015

21:43

Masala bonds in India’s new cash-and-curry push

Masala bonds in India’s new cash-and-curry push

What are the new rupee denominated overseas bonds that Prime Minister Modi spoke about in the UK? What’s in them for Indian issuers and foreign investors?

During his visit to the UK last week, Prime Minister Narendra Modi spoke about the Indian Railways issuing bonds and listing them on the London Stock Exchange. Indian companies have raised debt funds overseas for decades, including through bond offerings. But these have been borrowings in dollar or other currencies. The Railways bond, on the other hand, will be denominated in rupees. How did this come about? What are its benefits?

What’s new about the new bonds?

To raise funds for capital expenditure, Indian Railways proposes to borrow abroad through its financing arm — the Indian Railway Finance Corporation (IRFC) — by issuing bonds denominated in rupees. IRFC, the Konkan Railway Corporation, and many other Indian firms have earlier raised money abroad through bonds and other forms of borrowings, but always in foreign currency. Rupee bonds will be a new beginning; and several other Indian issuers — HDFC, which plans to raise $ 750 million, IIFCL, a state-backed funder of infrastructure projects, Power Finance Corporation Ltd, which arranges finance for the electrical power sector, power producer NTPC, etc. — are next in line. However, the first overseas rupee bonds, the so-called “masala bonds”, were issued in 2013 by the International Finance Corporation or IFC, the World Bank’s private sector investment arm.

How does issuing bonds in rupees help an Indian issuer? 

An Indian company or issuer of an overseas bond offering runs a risk on account of currency fluctuation. A weakening of the rupee during the tenure of the bond can, for instance, add significantly to costs at the time of redemption or repayment — normally at the end of five years. By pricing or issuing bonds in rupees, the issuer gets rid of this risk which, instead, passes on to the investor. Besides, borrowing overseas can be relatively cheap compared to India, with average costs at least 200 basis points lower. It also offers the promise of a new and diversified set of investors for Indian companies, and more liquidity in exchanges such as London, apart from bank funding and the corporate bond market in India. And what’s in it for the foreign investor? An investor who buys a bond issued by an Indian entity at a rate that is, say, 200 basis points above the globally accepted pricing benchmark — the London Interbank Offered Rate or Libor (based on average borrowing quotes of a group of banks in the UK) — is betting on India, and hoping that currency and inflation would be stable enough to ensure good returns after hedging for foreign exchange risks. With India’s GDP or national income rising, and projected to grow at a reasonably fast clip over the next few years, many overseas investors would like to buy into such bonds to join the party — and to earn higher returns compared to the US and Europe where interest rates are still low.

From the perspective of the government and RBI, what does the issuance of rupee denominated bonds abroad indicate? 

From a external balancesheet point of view, it will be welcomed by both, as worries related to the foreign currency risks of Indian firms ebb. Many Indian companies with large borrowings abroad hardly hedge their debt exposure or cover their risks, which is a worry for the central bank. From that point of view, higher issuance of such local currency debt abroad should be welcome, though the borrowings will be counted as part of India’s overall foreign borrowings. It will also be a sign of early acceptance of the Indian currency in trading and settlement overseas. In other words, this will be an attempt at testing the internationalisation of the currency over the medium- and long term, and of the confidence of investors. But a potential worry for the RBI could be the currency rate setting as issuance grows. Foreign investors may prefer to hedge their rupee investments in the Non Deliverable Forward Market abroad, over which the Indian central bank has no control. Foreign investors prefer to hedge their risks overseas because there are limited products in the Indian market, especially for longer periods. The other worry, if the overseas rupee bond market takes off, will be about the growth of the Indian corporate bond market and Indian banks as top companies shift to another market, impacting growth here. 

Have other emerging market countries done something like this? 

China has been ahead. In October, when President Xi Jinping was in London, the People’s Bank of China issued yuan denominated bonds to raise funds at a little over 3%. The offering was a huge hit. Through its state owned lenders, China already issues bonds in its own currency in Hong Kong — dubbed “dimsum bonds” — and plans to issue more as part of its plan to push its currency for global trade. A key difference between India and China is that unlike China, the Indian government has never borrowed abroad on its own — preferring to push its state owned firms, instead. And RBI, unlike the Chinese central bank, cannot issue debt with no legal sanction for it.



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Tuesday, 27 October 2015

21:18

LIC Presents the Cheque of Rs.2000 crore as the First Tranche of Funding Assistance to Railways

LIC Presents the Cheque of Rs.2000 crore as the First Tranche of Funding Assistance to Railways

The move Marks the Beginning of a Historic Milestone in the form of Institutional Financing for the First time Becoming Available for Railway Projects

Suresh Prabhu : Fresh Investments to Help Decongest the Network, Increase Traffic Output and Generate Adequate Internal Resources

Life Insurance Corporation (LIC), a PSU of Government of India presented the cheque of Rs.2000 crore to Railway PSU Indian Railway Finance Corporation (IRFC) as the first tranche of funding assistance to Railways for its projects. This handing over of cheque was done today i.e. 27.10.2015 at an impressive function at Rail Bhawan in the presence of Ministry of Railways Shri Suresh Prabhakar Prabhu. The cheque was handed over by Shri S.B. Mainak, MD/LIC to Shri Rajiv Dutt, MD/IRFC. On this occasion, Chairman Railway Board Shri A.K. Mital, Financial Commissioner (Railways) & Chairman, IRFC Shri S. Mookerjee; and other Board Members & other Railway and LIC officials were among those present.

It may be recalled that just within fifteen days of presenting the Railway Budget 2015-16, an important commitment of Budget announcement was fulfilled on 11.03.2015 when Railways and LIC signed an MoU for the highest ever funding of Rs. 1.5 lakh crore from LIC to Railways. 

Addressing the gathering, Minister for Railways Shri Suresh Prabhakar Prabhu, pointed out that finding resources for investment in capacity enhancement projects was a major challenge for Railways. Without investment, it would not be possible to decongest the network, increase traffic output and generate adequate internal resources. He said that without the fresh investment, the Railways would have gone further down and down and it would not have succeeded in breaking the vicious cycle. The Railway budget 2015-16 had, therefore, envisaged a new source of funds in the form of Institutional Finance. It was a big achievement that within a few days of presenting the budget, the Ministry of Railways signed a Memorandum of Understanding with LIC for funding assistance of Rs.1.5 lakh crore for financing Railway projects over a period of 5 years. As LIC funding will be of 30 year tenor, it matches the Railways’ requirement of long term funds for investment in projects.

LIC funds will carry low interest rates tied to Government security, and the cost of funds are expected to come down further over a period of time. Shri Suresh Prabhakar said that an important beginning has been made today with the release of first cheque of LIC funds. It is now for the Railways to match up to the challenge of utilizing the funds in a productive and appropriate manner for realizing maximum benefit. He said that these funds will not only meet the requirement for the new railway projects but will also be utilised for those ongoing projects which will bring quick benefit to the railway system. He said that this arrangement of funds from LIC will be beneficial for both the organizations. Referring to Railway PSU IRFC, Shri Suresh Prabhu said that IRFC has now emerged as an important vehicle for channelizing investment for Railways. 

In his speech, MD/LIC Shri Mainak described it as a Golden Day as LIC has found a partner in the Indian Railways which is a viable and sound organization for investing the long term funds available with LIC. MD/LIC offered continued support for Railway projects in future. 

The LIC funds are available to the Railways at a rate of 30 bps over the 10-year benchmark yield. The tenor is 30 years with a moratorium of 5 years followed by payment of only interest from year 6 to year 10. From the 11th to the 30th year the loan will be repaid in equated instalments. 

Advisor Finance, Railway Board, Shri P.V. Vaidialingam proposed the Vote of Thanks at the end of the programme. Ms. Namita Mehrotra, Executive Director Finance (Resource Mobilization) Railway Board, conducted the proceedings of the programme. 

 Source: PIBNEWS.
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07:12

LIC to buy corporate bonds worth Rs 2,000-cr from Indian Railways

LIC to buy corporate bonds worth Rs 2,000-cr from Indian Railways 

MUMBAI: India's largest insurer and national transporter are set to kick off their funding journey with a bilateral bond deal. 

LIC would subscribe to about Rs 2,000 crore worth of corporate bonds from the Indian Railways this week in what's the beginning of a Rs 1.5 lakh crore investment deal over the next five years. These 30-year maturity bonds are likely to yield 30 basis points more than the government benchmark bond, said three people familiar with the matter. 

"While the insurer would benefit in terms of credit quality, the funding will help the railways carry out long-term projects," one of the executives cited above told ET, adding that the deal would be announced in a day or two. Going by the average benchmark in the past few weeks, such bonds may yield anything between 8.75 and 8.85%. 

The bond deal is seen more of a loan at a concessional rate, the permission for which has been taken from the Reserve Bank of India. Indian Railway Finance Corp (IRFC), which is the financing arm of the Indian Railways, is likely to offer Rs 17,200 crore worth of such bonds to LIC this financial year. Funds would be channelised by the railways for capacity expansion and longterm projects. 

The ministry also intends to fasttrack sanctioned works on 7,000 km of double/third/fourth lines and commission 1,200 km in 2015-16 at an investment of Rs 8,686 crore. 

Long-term funds are essential to revamp the ailing network as banks alone cannot meet such huge requirements. Other pledges that need to be met include bullet trains and air-conditioned local trains for Mumbai. 

IRFC, a government-owned triple-A rated entity, is also likely to float tax-free bonds for a few thousand rupees even as the institution is discussing with investment bankers ways to sell rupee-denominated offshore bonds. "Ensuring a pipeline of investments is the only way the railways can create new capacities and bring in the necessary upgradation," Deepak Parekh, chairman of HDFC, had written. 

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Thursday, 22 October 2015

18:05

Rail Minister asks all PSUs to undertake more Railway projects

Rail Minister asks all PSUs to undertake more Railway projects

In a review meeting with the heads of the Central Public Sector Enterprises (CPSEs) under the administrative control of Railways, Prabhu also sought strong presence of all Railway PSUs on the social networking sites for dissemination of information to the public

New Delhi: Minister of Railways Suresh Prabhakar Prabhu held a review meeting with the CMD/MD of the Central Public Sector Enterprises (CPSEs) under the administrative control of Ministry of Railways. In addition, the meeting was attended by Chairman, Railway Board and other Board Members.
The Railway Minister directed that the CPSEs should ensure transparency in their working and to follow the best practices in their tenders / contracts and other activities etc. He also told the CPSEs to be ready to undertake more Railway projects which may be given to them shortly. They should be ready to leverage their resources and reserves for these projects. Funds should not be a constraint for the Railway projects.

He also directed that all the CPSEs should make all out effort to show profit and hand over healthy dividend to the Railways. Turnover / Production targets fro the financial year 2015-16 should be exceeded. Each of the projects undertaken by them should be meticulously planned. The CAPEX targets should be met without fail. It should be examined whether the production units and workshops of Railways may adopt the method of profit and loss accounting.

In the review meeting with the heads of the Central Public Sector Enterprises (CPSEs) under the administrative control of railways, Prabhu also sought strong presence of all railway PSUs on the social networking sites for dissemination of information to the public.

All of them were asked to open their Facebook account and Twitter handle and inform the public about the work being done by these units, a senior Railway Ministry official said. The CPSEs have been asked to develop their own Facebook and Twitter handle and inform the public about the good work being done by them.

The Railways PSUs participated in the review meeting included: Container Corporation of India Ltd.(CONCOR), IRCON International Ltd., Indian Railway Catering and Tourism Corporation (IRCTC), Indian Railways Finance Corporation (IRFC), Konkan Railway Corporation Ltd. (KRCL), Mumbai Rail Vikas Corporation (MRVC), Rail Vikas Nigam Ltd. (RVNL),RailTel Corporation of India Ltd. (RCIL),RITES Ltd.,Dedicated Freight Corridor Corporation of India Ltd. (DFCCIL), Burn Standard Company Ltd.,Braithwaite & Company Limited, Bharat Wagons Engineering Ltd. (BWEL), Kolkata Metro Rail Corporation Ltd (KMRCL).
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Friday, 7 August 2015

07:40

Railway Ministry convenes a meeting of Financial Institutions to sensitize the finance community of emerging investment opportunities in the Railway Sector

Railway Ministry convenes a meeting of Financial Institutions to sensitize the finance community of emerging investment opportunities in the Railway Sector 

Following up on the Banks’ & Financial Institutions’ Conclave held in Delhi on 21st July 2015, the Ministry of Railways are convening a meeting in Mumbai tomorrow i.e. on 7th August, 2015 with representatives of Financial Institutions to sensitize the finance community of emerging investment opportunities in the Railway Sector. 

The meeting of senior Railway officials with Heads and CEOs of FIs & a few corporates is being organized at the initiative of the Minister of Railways Shri Suresh Prabhakar Prabhu who had in his maiden Railway Budget unveiled massive investment plans for strengthening and modernizing the key Railway infrastructure in the country. 

Shri Suresh Prabhu, Chairman, Railway Board and Financial Commissioner, Railways are scheduled to address the meeting. 

The Railways’ conclave with major Banks & Financial Institutions in New Delhi on July 21, 2015, the first of its kind in the Indian Railways’ long history, which was well received by the financing community. Minister of State for Finance Shri Jayant Sinha and Dr. Raghuram Rajan, Governor, RBI had addressed the conclave. 

The meeting is being held in Mumbai this time to increase exposure and visibility to the investment plan of Railways. The Indian Railway Finance Corporation (IRFC) which is the financial intermediary for the Railways is co-hosting the meeting. 

Source :PIBNEWS.
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Sunday, 26 July 2015

19:58

Massive investment plans for strengthening and modernizing Railways

New Delhi: The Ministry of Railways and its PSU Indian Railway Finance Corporation (IRFC) hosted a meeting of Banks & Financial Institutions in New Delhi on July 21, 2015. The conclave was organized at the initiative of the Minister of Railways Shri Suresh Prabhakar Prabhu to sensitize the banking community of the opportunities and challenges offered by the Railways’ massive investment plans for strengthening and modernizing the key Railway infrastructure in the country.

Recognizing the significance of scaling up investment in Railway infrastructure in the country’s economic growth, the meeting was addressed by Minister of Railways Shri Suresh Prabhu, the Minister of State for Finance Shri Jayant Sinha and Dr. Raghuram Rajan, Governor, Reserve Bank of India.

In his introductory address, Shri Prabhu drew attention of the Banking and Finance community of the numerous initiatives unfolded in the Railway Budget 2015-16 to modernize the system, to remove bottlenecks and to build capacity. He stated that Railways have drawn up an ambitious investment plan of Rs.8.5 lakh crore in the coming 5 years. He referred to the MOU with LIC which has assured funds of Rs.1,50,000 crore in 5 years for Railway projects. Thereafter, a detailed presentation of Railways’ investment plans was made at the meeting.

Shri Jayant Sinha, MOS (Finance) appreciated the Ministry of Railways’ plans for massive investments in the sector and emphasized the need to get the projects going without delay as the economy is poised at the profound moment between fiscal consolidation and fiscal expansion. He urged for innovation in financing and structuring.

The Governor, RBI, in his speech pointed out the long term nature of investments in Railways and the need to create appropriate structures which will withstand political and regulatory risks in the long term. Learning from the recent past, financing plans will have to provide for more equity cushion, flexible debt structures and allow for a reasonable coverage of cost overruns. He also stressed the need for developing strong technical and economic skills in Banks and FIs for project evaluation and monitoring.

Representatives from principal Banks and Financial Institutions attended the meeting. Chairman, Railway Board, Financial Commissioner and senior officers of the Railway Board were present. The heads of Railway PSUs also unveiled their investment plans at the meeting.
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Tuesday, 10 March 2015

22:12

IRFC banks on 3-5 year Bonds to raise up to Rs.4,000 Crore

IRFC banks on 3-5 year Bonds to raise up to Rs.4,000 Crore

Mumbai: Indian Railway Finance Corporation (IRFC), the stateowned financier for railway projects, plans to raise up to Rs.4,000 crore by selling bonds with shorter maturities as it aims to reduce borrowing costs by taking advantage of the Reserve Bank of India’s (RBI) falling rate cycle.

A top executive with the railways told that the triple-A rated company may launch the bond issue as early as this week. IRFC may offer 3-5 year maturities, unlike its usual bond sales with 10-15 year maturities, to raise Rs.3,000-4,000 crore, the executive said, on condition of anonymity.

According to market participants, the rates could be fixed in the range of 8.15-8.20%. “There is no point in paying more than 8% rate for 10 years, especially when interest rates are trending downward,” the executive said. “Rather, IRFC can go for shorter maturities below five years and refinance the same periodically at lower rates.”

Issue arrangers may meet the company on Tuesday. In less than two months, RBI has cut the benchmark policy rate by 50 basis points, marking the beginning of the much-expected lower interest rate regime.

IRFC was mandated to raise around Rs.12,000 crore this financial year compared with Rs.14,942 crore a year ago. The company has already collected close to Rs 8,000 crore. In 2015-16, it has targeted to mop up 47% higher funds at Rs.17,655 crore as the Indian Railways proposes to expand operations. The issuer has apparently better asset liability management that allows some leeway to go for relatively short-term borrowings. Its average borrowing duration is about nine years while the average repayments are of the same.

Moreover, it may obtain some equity infusion from the railway ministry to shore up the capital base, market sources said. Unlike other state-owned financiers such as Rural Electrification Corporation, IRFC does not hit the market frequently, but occasionally with a larger size. “IRFC enjoys a premium in the market being a quasisovereign security,” said Shashikant Rathi, head, investments and capital markets, Axis Bank.

IRFC had last raised Rs.2,625 crore in January, offering 2.3 year bonds at 7.83% with 15 months call and put option, which ensures an investment exit route before the maturity.

Short-bond maturities will serve the issuer good on two counts by helping it bring down borrowing costs in a softening interest rate cycle, as the company can always refinance its funds needs periodically. It will also attract FII investments at finer rates due to their bulk buying, dealers said.



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