P Ltd. is planning to borrow an amount of 60 crores for a period of 3 months in the coming 6 month's time from now. The current rate of interest is…

P Ltd. is planning to borrow an amount of 60 crores for a period of 3 months in the coming 6 month's time from now. The current rate of interest is 9% p.a., but it is likely to go up in 6 month's time. The company wants to hedge itself against the likely increase in interest rate. You as CFO has been asked to suggest both traditional as well as modern methods to hedge interest rate risk. Suppose the banker of P Ltd. has quoted the following Forward Rate Agreement (FRA) rates: 3 x 6 9.10% 9.15% 6 x 9 9.20% 9.30% 9 x 12 9.35% 9.45% Based on the above information answer the following questions: