REC gets shareholders nod to raise borrowing limit to Rs 4.5 lakh cr

State-run REC on Saturday said it shareholders have approved a proposal to raise the overall borrowing limit to Rs 4.5 lakh crore from the existing Rs 3.5 lakh crore. The said limit of Rs 85,000 crore shall be within the overall revised borrowing limit being proposed for approval by the shareholders at the AGM.

State-run REC on Saturday said it shareholders have approved a proposal to raise the overall borrowing limit to Rs 4.5 lakh crore from the existing Rs 3.5 lakh crore. The company's 51st annual general meeting (AGM) held on September 25.

Resolutions, as set out in the Notice of 51st AGM of the Company, have been duly approved and passed by the shareholders with the requisite majority, a BSE filing said. "The consent of the Members is sought for increasing the borrowing limit from Rs 3,50,000 crore to Rs 4,50,000 crore to cover the further requirement of borrowings," the AGM notice had stated earlier. Current outstanding together with projected borrowings during 2020-21 is likely to exceed overall borrowing limit of Rs 3.5 lakh crore, the notice had said.

The net amount of borrowings of the company as on March 31, 2020, was Rs 2,80,116 crore and a sum of Rs 1,10,000 crore is likely to be borrowed in 2020-21 for lending activities. The borrowing will be done by way of issue of bonds to investors, availing long-term loans from banks and financial institutions, foreign currency borrowings, among others.

Shareholders also approved a special resolution for raising funds through a private placement of unsecured/ secured non-convertible bonds /debentures of up to Rs 85,000 crore in one or more tranches. The said limit of Rs 85,000 crore shall be within the overall revised borrowing limit being proposed for approval by the shareholders at the AGM.

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