Power Finance Corp to launch maiden bonds allowing capital gain tax exemption
State-run Power Finance Corp (PFC) is likely to launch its maiden 54 EC capital gain bonds issue early next month and is expecting to raise up to Rs 18,000 crore through issuance of the securities. “After the government’s approval to raise funds through capital gain bonds under Section 54EC(of the Income Tax Act), the PFC board will meet on 3 July 2017 to take a call on the launch of these securities. These bonds can be launched immediately after that,” a source said.
The Finance Ministry has already notified the order allowing PFC to raise funds for long terms through issuance of tax free bonds under Section 54EC.
“The PFC is expecting that 15-25% of its total borrowings would come through these capital gain bonds. The company’s borrowing would be slightly higher than Rs 70,000 crore last year. Thus, it is eyeing up to Rs 18,000 crore funds through these bonds,” he said.