Gujarat Gas Seeks Shareholders Nod To Raise Borrowing Limit By Rs 5,000 Crore
Gujarat Gas Ltd. has sought shareholders nod to raise its borrowing limit to Rs 15,000 crore from the current Rs 10,000 crore to help meet funding needs for its business expansion.
The city gas distributor is seeking "the approval of the shareholders for enhancing the borrowing limits up to 15,000 crore (apart from temporary loans obtained from the company's bankers in the ordinary course of business) by way of a Special Resolution," said Gujarat Gas on Thursday.
The resolution would be voted on at the company's seventh annual general meeting on Sept. 20 in Gandhinagar, Gujarat.
"Looking at business expansion prospects, there is a requirement to have an enabling resolution on the borrowing limits to quickly cater to the future funding for infrastructure expansion.
"Under such circumstances, it is likely the borrowings by the company may exceed the borrowing limits of Rs 10,000 crore, as approved by the shareholders in its 5th Annual General Meeting held on Sept. 28, 2017," it said.
It also sought shareholders approval to grant authority to the company board to determine the terms and conditions of any borrowings.
Gujarat Gas is India’s largest city gas distribution firm with presence in 23 districts of Gujarat, Dadra & Nagar Haveli and Thane in Maharashtra.
City gas distribution business entails retailing compressed natural gas to automobiles and piping natural gas to household kitchens. It also entails selling gas to industrial users for use as feedstock and as a source of fuel. It sells PNG to more than 13.5 lakh residential consumers and over 12,300 commercial users. The company also dispenses CNG from 344 CNG stations to automobiles.
"In the 10th CGD bidding round announced by Petroleum and Natural Gas Regulatory Board of India (earlier this year), the company has won six geographical areas, or GAs, comprising of 17 cities in the states of Punjab, Haryana, Madhya Pradesh and Rajasthan, making the company, a pan India company," said Gujarat Gas.