Recently, one of India’s largest power producers, NTPC, has invited proposals from banks to take rupee loans of up to INR 5,000 crore that is needed for its capital expenditure program. Though, the PSU chooses each bank or financial institution to abide by an unqualified and irretrievable binder mentioning the rate of interest (in two decimals) and the quantum of loan offered.
Also, the loan document clues that banks should estimate the lowest rate of interest that is supplementary to MCLR or linked to any other market firm exterior scale, visibly postulating the rearrange period that could not be less than one month.
Amendment in quantum, as well as ROI, would not be allowed once the bid has been submitted. Alongside, each bank would be needed to participate only if the quantum of loan is INR 500 crore or more.
The firm’s RFW fit loan mentions that ensue of the loan shall be used towards capital expenses for on-going/new capacity addition programs, that comprise seizure of projects, ordering out government's equity share in PSUs under the disinvestment program of the government of India, renewable energy projects, coal mining and washers, renewal and innovation of various projects, refinancing of loans and general corporate purposes and many more.