External commercial borrowing

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External commercial borrowing

  1. 1. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 External Commercial BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. Borrowing Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 EMAIL Divya Raman info@altacit.com Corporate Department WEBSITE www.altacit.com Altacit Global
  2. 2. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 EMAIL info@altacit.com WEBSITE www.altacit.com
  3. 3. INTRODUCTION CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, • An instrument used in India to facilitate Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 the access to foreign money by Indian corporations and PSUs (public sector BANGALORE Suite 920, Level 9, Raheja Towers, undertakings). 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. • The DEA (Department of Economic Affairs), Ministry of Finance, Tel: +91 - 422 – 6552921 Government of India along with Reserve Bank of India, monitors and regulates EMAIL info@altacit.com ECB guidelines and policies. WEBSITE www.altacit.com
  4. 4. EXAMPLES OF ECB CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, • Commercial bank loans. Mylapore, • Buyers credit. Chennai - 600 004. Tel: +91 - 44 - 2498 4821 BANGALORE • Suppliers credit. Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, • Securitized instruments such as floating rate notes and fixed rate bonds. # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 • Credit from official export credit agencies. EMAIL info@altacit.com WEBSITE www.altacit.com
  5. 5. ROUTES CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 BANGALORE • Automatic Route Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, • Approved Route # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 EMAIL info@altacit.com WEBSITE www.altacit.com
  6. 6. AUTOMATIC ROUTE CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, • Eligible Borrowers: Mylapore, 2.Corporates (registered under the Chennai - 600 004. Tel: +91 - 44 - 2498 4821 BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, companies Act except financial intermediaries (such as banks, financial Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. institutions (FIs), housing finance companies and NBFCs) are eligible to Tel: +91 - 422 – 6552921 raise ECB. Individuals, Trusts and Non- Profit making Organizations are not EMAIL info@altacit.com eligible to raise ECB. WEBSITE www.altacit.com
  7. 7. AUTOMATIC ROUTE contd… CHENNAI 1. Units in Special Economic Zones (SEZ)3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 are allowed to raise ECB for their own requirement. However, they cannot BANGALORE Suite 920, Level 9, Raheja Towers, transfer or on-lend ECB funds to sister 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, concerns or any unit in the Domestic Tariff Area. Coimbatore - 641018. Tel: +91 - 422 – 6552921 • Recognized Lenders: 3. International Banks 4. International Capital Markets EMAIL info@altacit.com WEBSITE www.altacit.com
  8. 8. AUTOMATIC ROUTE contd… CHENNAI 3. Multilateral Financial Institutions3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 (such as IFC, ADB, CDC, etc.,) BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, 2. Export Credit Agencies Bangalore - 560 001. 3. Suppliers of equipment. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, 4. Foreign Collaborators. # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 5. Foreign Equity Holders (other than erstwhile OCBs). EMAIL info@altacit.com WEBSITE www.altacit.com
  9. 9. AUTOMATIC ROUTE contd… CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, • Amount and Maturity: Mylapore, 2. The maximum amount of ECB which can Chennai - 600 004. Tel: +91 - 44 - 2498 4821 be raised by a corporate is USD 500 BANGALORE Suite 920, Level 9, Raheja Towers, million or equivalent during a financial 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, year. Coimbatore - 641018. Tel: +91 - 422 – 6552921 3. ECB up to USD 20 million or equivalent in a financial year with minimum average maturity of three years. EMAIL info@altacit.com WEBSITE www.altacit.com
  10. 10. AUTOMATIC ROUTE contd… CHENNAI 3. ECB above USD 20 million and upto3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 USD 500 million or equivalent with a minimum average maturity average BANGALORE Suite 920, Level 9, Raheja Towers, maturity of five years. 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. 4. ECB upto USD 20 million can have call / put option provided the minimum Tel: +91 - 422 – 6552921 average maturity of three years is complied with before exercising call / EMAIL info@altacit.com put option. WEBSITE www.altacit.com
  11. 11. APPROVAL ROUTE CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, • Eligible Borrowers Mylapore, 2.Financial institutions dealing Chennai - 600 004. Tel: +91 - 44 - 2498 4821 BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, exclusively with infrastructure or export finance such as IDFC, IL&FS. Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE 3.Banks and financial institutions which BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 had participated in the textile or steel sector restructuring package as approved by the Government. EMAIL info@altacit.com WEBSITE www.altacit.com
  12. 12. CHENNAI 3. ECB with minimum average maturity3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 of 5 years by Non-Banking Financial Companies (NBFCs). BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, 4. Foreign Currency Convertible Bonds Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. (FCCBs) by housing fnance companies. Tel: +91 - 422 – 6552921 5. Special Purpose Vehicles, or any other entity notified by the Reserve Bank. 6. Multi-State Co-operate Societies engaged in manufacturing activity. EMAIL info@altacit.com WEBSITE www.altacit.com
  13. 13. CHENNAI 7.Corporates engaged in industrial sector3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 and infrastructure sector . BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, 8. Non-Government Organizations (NGOs) engaged in micro finance Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. activities. Tel: +91 - 422 – 6552921 9. Corporate in services sector viz. hotels, hospitals and software companies. 10. Cases falling outside the purview of the automatic route limits. EMAIL info@altacit.com WEBSITE www.altacit.com
  14. 14. CHENNAI Amount and Maturity3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, 1. Corporates can avail of ECB of an Chennai - 600 004. Tel: +91 - 44 - 2498 4821 BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, additional amount of USD 250 million with average maturity of more than 10 Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. years under the approval route, over and above the existing limit of USD 500 Tel: +91 - 422 – 6552921 million under the automatic route, during a financial year. EMAIL info@altacit.com WEBSITE www.altacit.com
  15. 15. CHENNAI 2. Corporates in infrastructure sector {as3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 defined in paragraph 1(A) (v) (a)} can avail ECB up to USD 100 million and Corporates BANGALORE Suite 920, Level 9, Raheja Towers, in industrial sector can avail ECB up to 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, USD 50 million for Rupee capital expenditure for permissible end- uses Coimbatore - 641018. Tel: +91 - 422 – 6552921 within the overall limit of USD 500 million per borrower, per financial year, under EMAIL Automatic Route. info@altacit.com WEBSITE www.altacit.com
  16. 16. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, 3. NGOs engaged in micro finance activities can raise ECB up to USD 5 million during a Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 BANGALORE Suite 920, Level 9, financial year. Designated AD bank has to ensure that at the time of drawdown the Raheja Towers, 26-27, M G Road, Bangalore - 560 001. forex exposure of the borrower is hedged. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 4. Corporates in the services sector viz. hotels, hospitals and software companies can avail ECB up to USD 100 million, per borrower, per financial year, for import of capital goods. EMAIL info@altacit.com WEBSITE www.altacit.com
  17. 17. CONVERSION OF ECB INTO EQUITY CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, • Conditions Mylapore, 2. The activity of the company is covered under Chennai - 600 004. Tel: +91 - 44 - 2498 4821 the Automatic Route for Foreign Direct BANGALORE Suite 920, Level 9, Raheja Towers, investment or Government approval for 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, foreign equity participation has been obtained by the company. # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 3. The foreign equity holding after such conversion of debt into equity is within the sectoral cap, if any. EMAIL info@altacit.com WEBSITE www.altacit.com
  18. 18. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. 3. Pricing of shares is as per SEBI Tel: +91 - 44 - 2498 4821 BANGALORE Suite 920, Level 9, Raheja Towers, and erstwhile CCI guidelines / 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 regulations in the case listed / COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. unlisted companies as the case Tel: +91 - 422 – 6552921 may be. EMAIL info@altacit.com WEBSITE www.altacit.com
  19. 19. CHENNAI The Reserve Bank of India (RBI) has3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 authorized Category-I authorized dealer banks to allow relaxations in the BANGALORE Suite 920, Level 9, Raheja Towers, drawdown and repayment schedule of 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, external commercial borrowings. Coimbatore - 641018. ADs are also authorized to extend foreign Tel: +91 - 422 – 6552921 currency loans to other authorized dealers in India subject to the directions EMAIL info@altacit.com or guidelines issued by the RBI from time WEBSITE www.altacit.com to time.
  20. 20. CHENNAI3rd Floor, ‘Creative Enclave’,148-150, Luz Church Road, Mylapore, Chennai - 600 004. Tel: +91 - 44 - 2498 4821 BANGALORE Suite 920, Level 9, Raheja Towers, 26-27, M G Road, Bangalore - 560 001. Tel: +91 - 80 - 6546 2400 COIMBATORE BB1, Park Avenue, # 48, Race Course Road, Coimbatore - 641018. Tel: +91 - 422 – 6552921 EMAIL info@altacit.com WEBSITE www.altacit.com

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