Financial Briefs: India and overseas

India and overseas

NTPC to raise Rs 50 billion via stake sale in NGEL

NTPC Limited is planning to raise Rs 50 billion by selling a stake in NTPC Green Energy Limited (NGEL), a 100 per cent subsidiary of NTPC. NTPC has engaged SBI Capital Markets as the adviser on the sale process, which could be formally la­un­ched in October 2022. NTPC will hive off 15 of its renewable energy projects in­to NGEL. The assets being separated ha­ve a book value of Rs 100 billion. Addi­tionally, its 100 per cent stake in NTPC Renewable Energy Limited is also being transferred to NGEL.

ReNew becomes first Indian renewable energy company to refinance dollar-denominated bonds

ReNew Energy Global plc has refinanced its 2024 maturity dollar-denominated bonds with amortising project debt from an Indian non-bank financial company, becoming the first Indian renewable en­ergy company to do so. ReNew had issu­ed bonds worth $525 million in 2019, whi­ch were set to mature in 2024. By refinancing the dollar-denominated bonds ahead of time, ReNew has shown continued access to domestic debt capital, as well as an ability to proactively manage refinancing risk. This refinancing has cut the bonds’ interest cost in rupees by 200 basis points, with the interest rate fixed for three years, while pushing out the maturity to the end of fiscal year 2027.

Powergid’s board approves proposals to raise Rs 110 billion

Power Grid Corporation of India Limit­ed’s (Powergrid) board has approved two proposals to raise up to Rs 110 billion through the issuance of bonds and term loans. The board has approved a propo­sal to raise funds up to Rs 60 billion from the domestic market through issuan­ce of se­cured/unsecured, non-convertible, non-cumulative/cumulative, redee­m­able, taxable/tax-free debentures/bon­ds under private placement during 2023-24 in up to 20 tranches/offers. Fur­ther, the board approved a proposal for sanction of a ru­pee term loan of up to Rs 50 billion from commercial banks to meet capital expenditure and other business requirements. In a separate development, Pow­er­­­grid’s bo­ard has accorded approval for three tra­nsmission projects. Additio­nally, Pow­er­­grid’s board has given approval for in­corporation of a joint venture company bet­ween Powergrid and the Nepal Elec­tricity Authority with 50:50 equity participation for implementation of the Indian portion of the New Butwal-Gorakhpur 400 kV double circuit (quad moose) cro­ss-border transmission line.

PFC signs a loan pact of JPY 30 billion with JBIC

The Power Finance Corporation (PFC) has signed a loan agreement for JPY 30 billion with the Japan Bank for Interna­ti­onal Cooperation (JBIC). The long-term facility has been provided by JBIC to PFC under its Global action for Reconciling Eco­nomic growth and Environmental preservation (GREEN) initiative, whereby JBIC provides financing for projects that en­sure the effective reduction of greenhouse gas emissions. Thus, the funds un­der the facility would be used by PFC to finance its renewable energy portfolio.

CDPQ to buy additional 10 per cent stake in Apraava Energy for Rs 6.6 billion

Caisse de dépôt et placement du Québec (CDPQ), a global investment group, has increased its stake in Apraava Energy by acquiring an additional 10 per cent stake from CLP Group for Rs 6.6 billion. With this, both CDPQ and CLP will hold 50 per cent stake respectively in the com­pa­ny. Following the current transaction, CDPQ will have increased governance rights, equal to those of CLP, with respe­ct to Apra­ava Energy. Completion of the deal is subject to fulfilment of various conditions, including regulatory approvals.

Tata Power plans a capex of over Rs 750 billion in the next five years in renewables

Tata Power has planned a capital expenditure of Rs 750 billion over the next five years in its renewable energy business. Further, the company plans to increase its green energy share to 60 per cent by 2027. The company has planned a Rs 140 billion consolidated capex in 2022-23, with Rs 100 billion in renewables. The company holds a strong EPC order book of Rs 130 billion and is also setting up a 4 GW solar cell and module manufacturing capacity in Tamil Nadu at an investment of around Rs 30 billion.

The World Bank approves $165 million for residential rooftop solar projects in India

The World Bank has approved $165 million in financing to support 450 MW of rooftop solar deployment in the resi­den­tial sector of India. The bank had previously funded $648 million for In­dia’s grid-connected rooftop solar programme, primarily focusing on com­m­er­cial and in­du­strial rooftop PV syste­ms. This additional round of funding will expand the pro­gra­mme to cover the re­sidential sector and support the Go­vernment of India’s ta­r­get of 40 GW of rooftop solar installations.

Government of Vietnam invests over $800 million in Laos’s power projects (Vietnam)

The Government of Vietnam has invested around $815 million to finance multiple hydropower and mining projects in Attapeu province of Laos. Of the total investment, $691 million will be used to finance four hydropower projects in the province including the Xe­ka­man 1, Xe­ka­­man Sanxay, Xekong Loum A and Xe­kong Loum B hydropower pla­nts. The­­se facilities are scheduled to commence commercial operations in 2025. Other power projects include a thermal, a solar and a biomass power plant, and so­me tra­­nsmission lines. Meanwhile, $30.8 million has been invested to construct a transfor­mer station in Attapeau and $93.3 million will be invested in the pro­vince’s mining sector.