Reliance Industries chairman Mukesh Ambani have huge expansion plans in exploration, refining, petrochemical and retail over the next two months. Though it is difficult to raise cash in today''s risk adverse market, the company got assistance from the country''s largest insurer, LIC, to tide over the current crisis.
It is believed that RIL is raising a $1 billion from LIC as a short-term debt to meet its working capital requirements. The debt will be in the form of non-convertible debentures or NCDs for a 3 year period attracting a coupon rate of 11.5 per cent.
A billion dollar looks small as Reliance has already committed to spend $20 billion over the next 5 years. Since Reliance has always raised such high amount overseas but now such options simply don''t exist. Funding money for working capital is a headache that''s bothering everybody from corporates to bankers. It is tough for every corporate to raise money even for working capital - that''s something that policymakers need to consider.
It is believed that RIL is raising a $1 billion from LIC as a short-term debt to meet its working capital requirements. The debt will be in the form of non-convertible debentures or NCDs for a 3 year period attracting a coupon rate of 11.5 per cent.
A billion dollar looks small as Reliance has already committed to spend $20 billion over the next 5 years. Since Reliance has always raised such high amount overseas but now such options simply don''t exist. Funding money for working capital is a headache that''s bothering everybody from corporates to bankers. It is tough for every corporate to raise money even for working capital - that''s something that policymakers need to consider.
No comments:
Post a Comment