Financial Briefs

India and overseas

NTPC raises Rs 20 billion via green masala bonds (India)

NTPC Limited has raised Rs 20 billion through the issue of rupee-denominated green masala bonds in the overseas market. The bonds carry a coupon rate of 7.48 per cent per annum with a maturity period of five years. The bonds carry third-party assurance and climate bonds initiative certification, and are also listed on the London Stock Exchange. Investors from Asia contributed 70 per cent to the transaction, while the remaining came from Europe and the Middle East. The company will utilise the proceeds to finance its renewable energy projects.

Powergrid approves investments of Rs 27 billion for transmission projects

Power Grid Corporation of India Limited (Powergrid) has approved an investment of Rs 27.31 billion in transmission projects. Of this, Rs 14.29 billion is for the Transmission System for Solar Power Parks at Bhadla, Rajasthan (to be commissioned within 30 months); Rs 3.01 billion for transmission system strengthening associated with the Mundraultra mega power project (Part-B) (to be commissioned within 29 months); Rs 1.51 billion for the Western Region Strengthening Scheme-XVI (to be commissioned within 24 months); Rs 1.03 billion for the 230 kV D/C NLC-Karaikal line (to be commissioned within 16 months); and Rs 910.19 million for works associated with additional system strengthening of the Sipat super thermal power station (to be commissioned from November 2018 to March 2019 in a phased manner).

GE to invest $31 billion in Mytrah’s subsidiary

GE Energy Financial Services will invest $31 billion in Mytrah Vayu (Tungabhadra) Private Limited (MVTPL), a wholly owned subsidiary of Mytrah Energy (India) Private Limited. To this end, MVTPL has entered into a definitive agreement with Guayama P.R. Holdings B.V., an investment vehicle of GE Energy Financial Services. The investment, constituting 49 per cent of MVTPL’s total capital, will be utilised for developing 200 MW of wind energy projects in Andhra Pradesh.

Tata Power raises Rs 35 billion through debentures

Tata Power has raised Rs 35 billion through the issue of 35,000 non-convertible debentures on a private placement basis. The bonds carry a coupon rate of 7.7 per cent with a three-year maturity period. Kotak Mahindra Bank and YES Bank invested Rs 7.5 billion each; DBS Bank, Axis Bank and IDFC Bank invested Rs 5 billion each; and ICICI Bank and ICICI Securities invested Rs 2.5 billion each.

Essar Power plans to sell captive gas-based plants

Essar Power is reportedly planning to sell two of its captive gas-based power plants in Gujarat. These are the 515 MW Hazira power plant and the 500 MW Bhander plant, which are currently non-operational due to the unavailability of fuel. The genco has accumulated Rs 203.69 billion worth of debt and is looking to reduce it through asset monetisation. Essar Power has already restructured Rs 100 billion worth of debt under the 5/25 scheme of the Reserve Bank of India.

ReNew Power enters into a JV with Chinese solar company

ReNew Power Ventures Private Limited has entered into a joint venture (JV) with Chinese solar module manufacturing company Hareon for setting up 200 MW of solar projects. The projects, estimated to cost around Rs 10 billion, will be undertaken by two special purpose vehicles – ReNew Mega Solar and ReNew Solar Energy (Telangana). Hareon has entered into contracts worth Rs 1.7 billion and Rs 5.01 billion respectively for the two projects and will provide solar modules for them. This is ReNew Power’s second JV with Hareon, the first being for a 72 MW solar project in Andhra Pradesh commissioned in May 2016.

Chinese company to buy stake in Diamond Power Infrastructure

Chinese conglomerate Jiangsu Longzhe Technology and Trade Development Company Limited has agreed to acquire a majority stake in transmission equipment company Diamond Power Infrastructure Limited in a $125 million deal. Jiangsu Longzhe will initially acquire a 26 per cent stake in Diamond Power, and subsequently raise the stake to 51 per cent through an open public offering. After the transaction, Jiangsu Longzhe will pay $25 million as equity and the remaining $100 million as debt. Currently, 33 per cent stake in the company is owned by its promoter, 15 per cent by foreign portfolio investors and the remaining by the public.

AfDB approves $1.34 billion loan to Eskom (South Africa)

South Africa’s vertically integrated power company Eskom Holdings SOC Limited (Eskom) and the African Development Bank (AfDB) have signed a loan agreement worth $1.34 billion to finance Eskom’s 2016-20 capital expenditure (capex) programme. AfDB has arranged $965 million through participation arrangements with nine commercial banks – Bank of China, Bank of Tokyo-Mitsubishi, CaixaBank, Citibank, HSBC, JP Morgan Chase, KfW IPEX Bank, Siemens Bank, and Standard Chartered. Eskom’s capex programme includes investments in new generation, plant refurbishment, transmission lines, and capacity building of around $17 billion. By 2020, the company’s capex programme is expected to increase South Africa’s electricity generation by 11,000 MW and expand its transmission network by over 9,500 km.

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