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The clean energy arm of Hindustan Power Projects Ltd has become the first and largest domestic solar power player to enter the credit enhanced bond market having the issue fully underwritten by YES Bank.
With this, the clean energy arm is set to issue secured, rated, listed, and partially guaranteed debentures of ₹370 crore on a private placement basis to YES Bank for three of its AA+ SO rated projects at Porbandar in Gujarat.
According to a company statement, successful placement of the bonds will help in releasing long-term debt from the books of the developers into bonds and thereby aid in infusing funds into the sector.
The debentures will be listed on the wholesale debt market segment of the National Stock Exchange pursuant to and in accordance with the Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 (as amended).
IIFCL will provide a “first loss” partial credit guarantee to the bondholders and has gotten an irrevocable back-stop guarantee with the Asian Development Bank. Placement of these bonds, besides opening a new market for financing infrastructure projects, would also bring down the cost of capital for the projects.
Climatic conditions The climatic conditions in Gujarat ensures higher yield due to the prevalent ambient temperature. Choosing the solar projects in Gujarat from the renewable portfolio of the company, Ratul Puri, Chairman, Hindustan Power, said the State has been the hub for solar energy development in India.
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