By March 2024, Nabfid expects to have a loan book of $60,000 billion and sanctions of $1 billion

After lending Rs 8,000 crore in the first quarter, infrastructure lender National Bank for Financing Infrastructure & Development (Nabfid) expects to disburse over Rs 60,000 crore by the end of current fiscal.

Rajkiran Rai G, managing director, told PTI here on Tuesday after listing its first Rs 10,000-crore bonds on the BSE that the central government-backed infrastructure financier, which started operations less than a year ago, is also looking to sanction Rs 1 lakh crore loans this fiscal to both greenfield and brown-field assets in the important infrastructure space.

The lender collected Rs 10,000 crore last week via a debt offering, and while the base issue was just Rs 5,000 crore, there were almost five times as many offers, totaling Rs 23,629.50 crore.

Investors in the 10-year-term unsecured non-convertible debt instruments are being offered 7.43% a year by the issuer. This is a national financial institution’s highest debt issue to date.

“We spent Rs 18,000 crore previous fiscal year and have spent Rs 7,000 crore so far this fiscal year. We anticipate closing the year with a loan book of around Rs 60,000 crore and approving about Rs 1,000,000 crore, said Rai, expressing confidence in the strong institutional interest in the nation’s infrastructure.

Despite the fact that assets in the public sector have received 60% of financing overall, the entire disbursement in the June quarter went to the private sector, and moving ahead, he expects that percentage to rise.

In addition to thermal plants, data centres, city gas distribution, roads, including toll-roads and HAM (Hybrid Annuity Model) projects, Invits, and transmission lines, Nabfid loans to graded infrastructure assets in the green energy sector that are both new and operating.

Nowadays, 30% of its money typically goes towards greenfield projects, 20% towards asset monetization, and the remaining amount is allocated as funding terms loans to operating assets. According to Raj, term financing, which may range from one year to the remainder of the concession period, is an option for operating assets and can be used for new projects up to 30 years or the length of the concession period.

Raj said that while all upcoming airports are currently financially safe, Nabfid is also keeping an eye on the airports sector as and when there is an opportunity.

According to Raj, Nabfid charges 7.90% for its one-year term loan, which it refers to as the Nabfid lending rate or NLR, because banks and debt investors are willing to lend it money at a lower rate due to its sovereign guarantee and the additional 5,000 crore rupee special grant that the Centre has provided.

When asked whether Nabfid will provide tax-free bonds to regular investors, he said that not anytime soon since the company’s goal is to attract long-term capital from institutional investors.

Regarding future fund-raising initiatives, he said that he is considering approaching multilateral organisations and has already inked a contract with IFC to provide transaction consulting services to the World Bank arm.

Through the agreement with the International Finance Corporation, transaction advising services are to be made available for creating projects involving public and private partnerships. Over the next several years, the first projects are anticipated to mobilise around USD 2 billion in private investment in the national priority areas of renewable energy, energy storage, and urban infrastructure.

The goal of Nabfid is to expand the bond market by creating long-term non-recourse infrastructure funding.