Financial Express reported that Indian Railway Finance Corporation plans to raise nearly INR 9,000 crore through tax free bonds by March next year.

IRFC said that "The company shall issue bonds up to an aggregate amount of INR 8,981.40 crore through this issue during the fiscal 2013 out of the total permissible amount of INR 10,000 crore as approved by its Board through its resolution dated July 31st 2012."

IRFC, a government agency which lends to railway projects, has already raised INR 1,018.60 crore through the private placements of bonds.

According to the draft prospectus filed with Sebi, the company said that bonds would be issued in one or more tranches through non convertible debentures route.

An NCD is a type of loan-linked security issued by a company that cannot be converted into stock and usually carries a higher interest rate than a convertible debenture.

According to IRFC, funds raised through the issue would be utilized towards financing the acquisition of rolling stock which would be leased to the Ministry of Railways in line with present business activities.