A container terminal at the Jawaharlal Nehru Port in Mumbai
A container terminal at the Jawaharlal Nehru Port in Mumbai
Business & Economy

Jawaharlal Nehru Port Trust to raise upto Rs 500 crore through tax-free bonds

NetIndian News Network

Mumbai, March 9, 2013

The Jawaharlal Nehru Port Trust (JNPT), Mumbai will open on March 11 its public issue of tax-free bonds in the nature of secured redeemable non-convertible debentures of face value of Rs 1000 each, with an option to retain oversubscription upto Rs 1500 crore such that the overall issue size does not exceed Rs 2000 crore in the fiscal year 2013.

The issue will close on March 15. The bonds are proposed to be listed on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE), with NSE as the designated stock exchange for the issue, a press release from the company said.
The release said that, in terms of Central Board of Direct Taxes (CBDT) notification, the issuer may also issue tax free bonds in the nature of secured, redeemable, non-convertible debentures through private placement route for up to 25% of Rs. 2,000 crore, i.e. not exceeding Rs.500 crore. 
The issuer shall ensure that the funds raised through public issue route and/or private placement route shall together not exceed Rs. 2,000 crore. In case the issuer raises any such funds through private placement, the above aggregate of Rs. 2,000 crore shall be reduced to that extent, it said.
JNPT runs the Jawaharlal Nehru Port in Mumbai, providing various services and facilities pertaining to the handling of diverse types of cargo, including container, dry bulk, break bulk cargo and liquid bulk cargo.
The issue has been rated “CRISIL AAA/Stable” by CRISIL, "BWR AAA" by Brickwork. Instruments with such ratings are considered to have the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk, the release said.
Kotak Mahindra Capital Company Limited, ICICI Securities Limited and SBI Capital Markets Limited are the Lead Managers to the issue which is open to Qualified Institutional Buyers (QIBs), Domestic Corporates, High Networth Individuals (HNIs) and Retail Individual Investors. 
The bonds, with a tenure of 10 years,  will carry a fixed interest of 6.82% per annum. Additional interest rate of 0.50% i.e. 7.32% per annum shall be paid to original allottees in retail individual investors category, it said
The net issue proceeds raised through this issue are proposed to be utilised primarily for the purpose of dredging works for deepening and widening of the Mumbai harbour channel and JN Port’s navigational channel and capital expenditure for other projects in relation to the port operations. The total estimated cost of the dredging project is Rs. 1,571.60 crore and the estimated period for completion of this project is25 months.
JNPT has initiated capital dredging at the JN Port in order to enable handling of vessels up to draught of 14 metres, using tidal windows. The capital dredging work has been awarded to Boskalis International BV and is expected to be completed by September 2014. 
In addition, JNPT is currently undertaking feasibility studies for deepening of navigational channel further, for accommodating 17 metres draught vessels, using tidal window.
JN Port also provides other value-added port services like container freight stations and facilitation of rail handling. In fiscal year 2012, JN Port handled 55.60% of the total container cargo traffic handled by all major ports in India (in terms of TEUs), thus making it the leading port in the country for handling of container cargo in that period. 
JN Port is open for operations throughout the year. It is situated on the eastern end of the Mumbai harbour in Nhava Sheva, Maharashtra, and shares a common harbour channel with the Mumbai Port up to Jawahar Dweep Channel.
JNPT commenced its operations in 1989. Subsequently, in July 1997, JNPT entered into a license agreement with Nhava Sheva International Container Terminal Limited for developing a container cargo handling terminal.
Thereafter, in August 1999, JNPT entered into a license agreement with Bharat Petroleum Corporation Limited for development of a twin berth liquid bulk cargo handling terminal.
In August 2004, JNPT entered into a license agreement with Gateway Terminals India Private Limited for redevelopment of its existing bulk terminal into a container terminal.

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