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NLC India Limited, which is setting up a ₹ 17,238 crore power project through a joint venture company at Ghatampur, UP, has adopted a reverse auction route to raise loan at a competitive rate.
According to a press release from the company it has saved over ₹ 460 crore by achieving a competitive rate of 9.35 per cent for a loan amount of ₹4,200 crore through the reverse auction route. All major banks and financial institutions participated in the auction conducted with the help of MSTC.
Previously, it could manage only a higher interest rate of 10.50 per cent.
This model will be followed to raise more of the loan component helping in significant saving on project cost, the release said.
The total debt component for the 3X660 MW project is estimated at ₹ 12,067 crore, about 70 per cent of the project cost. The power project is being set up through a joint venture company, Neyveli Uttar Pradesh Power Ltd, in partnership with the state utility Uttar Pradesh Rajya Vidyut Utpadan Nigam Ltd.
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