Billionaire Anil Agarwal’s Vedanta Ltd. is preparing its biggest-ever rupee bond sale, as India’s largest producer of zinc and aluminum seeks to raise funds for capital expenditure.

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The company is seeking commitments Tuesday for as much as 48.09 billion rupees ($614 million) of 10-year notes, according to people familiar with the matter. Vedanta is planning to use the proceeds to prepay or repay existing debt and for capital spending, according to an information memorandum seen by Bloomberg.

Vedanta last tapped the local-currency bond market in December and is shoring up funds as the Indian government plans to sell its stake in Hindustan Zinc Ltd. soon. Agarwal’s Vedanta holds about 65 percent of the Udaipur-based company and the tycoon has over the years sought to tighten his hold on the cash-rich zinc producer and buy the government’s remaining portion.

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Vedanta is coming back to the bond market after its ratings were raised to AA by both Crisil and India Ratings & Research earlier this year. Even though the average yield on AA 10-year rupee corporate notes rose by 53 basis points this quarter to 8.48 percent, analysts see borrowing costs increasing further in coming months as the Reserve Bank of India hikes rates further to rein in inflation.

Vedanta didn’t immediately respond to emailed questions about its fundraising plans.

Last week, the 2024 dollar bonds of Vedanta’s parent company, Vedanta Resources Ltd, suffered the biggest drop on record, as plunging metal prices heightened concerns about the natural resources giant’s financial health.

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