The state run-India Infrastructure Finance Company Ltd (IIFCL) on Monday said that it is looking to raise upto Rs 9,215 crore through tax-free bonds amid indications that the instruments have remained attractive avenue for investments.

IIFCL chairman and managing director SK Goel said, "We plan to raise Rs 1,500 crore with green-shoe option up to the shelf limit of Rs 9,215 crore on first-come first-serve basis."

He said that the fund will be used to provide long-term financing to PPP projects in various sectors including power and other infrastructure sectors. The issue of IIFCL will open on December 26 and close on January 11.

These bonds will offer coupon rate of 7.69 per cent for 10 years, 7.86 per cent for 15 years and 7.90 per cent for 20 years to the retail investors. On the other hand, QIBs, HNIs and corporate receive a coupon rate that is 50 basis points lower than that offered to retail investors. Thus the tax-free bonds will offer returns of 7.19 per cent for 10 years, 7.36 per cent for 15 years and 7.40 per cent for 20 years to these investors.

IIFCL said that there will be no tax deduction at the time of investment in these bonds and the interest earned is also tax free.