Sunday, July 14, 2024

YEIDA’s Financial Leap: Infrastructure Bonds Worth Rs 10,000 Crore for Major Projects

YEIDA (Yamuna Expressway Industrial Development Authority) is set to raise Rs 10,000 crore through infrastructure and municipal bonds to fund major projects, including a rapid rail corridor. The authority is in the process of assessing its creditworthiness, a crucial step for accessing capital market borrowings. Two prominent credit rating agencies, CRISIL and CARE, have expressed interest in evaluating YEIDA’s financial standing.

The selected rating agency will analyze YEIDA’s financial management, strengths, weaknesses, and borrowing capacity for term loans. The funds raised will be allocated to significant ventures such as industrial and information technology parks, sports facilities, major roads, bridges, rapid rail corridors, and an international airport, as YEIDA aims for rapid and comprehensive development in the region.

A considerable portion of the funds will be dedicated to land acquisition and infrastructure development for industrial parks. Financing the rapid rail connectivity between Noida International Airport in Jewar and Delhi presents a notable challenge for YEIDA.

Infrastructure bonds, as debt instruments, involve fixed principal repayments with interest, supporting city development or maintenance projects. YEIDA, having recently secured an A+ rating from SBI when obtaining a loan, anticipates an improved rating due to its receipt of an interest-free loan from the state government and consistent profit growth.

YEIDA has issued a request for proposal to hire a rating agency, with a deadline of December 5 for bid submissions. The credit rating process will unfold in three stages, involving data gathering, presentation of a draft report with feedback, and the submission of the final credit rating report, a process spanning over seven months.

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