Energy Efficiency Services Limited, a super energy service company (ESCO), has sewn up plans for a massive capital expenditure of Rs 6,000 crore which it plans to fund through a debt equity ratio of 80:20.
While the equity component of Rs 1,200 crore would be bridged through contribution of about Rs 520 crore from its promoters NTPC, PFC, REC and PowerGrid, a part of it raised through an initial public offer (IPO) during the fourth quarter of this year.
Saurabh Kumar, Managing Director of EESL, said of the Rs 1,200 crore equity, the company has equity of Rs 485 crore and about Rs 520 crore would be pumped in by the promoters NTPC and others within couple of months and the rest raised through an IPO.
With regard to debt component, the company has commitments of about $ 550 million from ADB, German agency KFW and French lender AFD and negotiations are on with the World Bank too for additional funding.
Of the Rs 4,800 crore debt component, about Rs 800 crore has been tied up with bilateral and multilateral agencies, Rs 2,000 crore required for working capital would be met through domestic borrowings and the rest Rs 2000 crore through other domestic loans and offer of Green/Masala Bonds.
Green/Masala bonds
“Since the Green/Masala Bonds, wherein we are seeking to raise up to $ 100 million (about Rs 650 crore), require Government nod as these do not come under automatic route as in infrastructure sector, we are waiting for approvals. Once we get them, we will be able to raise the funds by September or October,” he told Business Line.
“Recently we had raised Rs 500 crore through domestic bonds and plan to come out with two more tranches of Rs 500 crore each for bonds offering, and all these bonds in the domestic market will go up to Rs 1,500 crore,” he said.
To facilitate the offer of Green/Masala bonds, EESL enlisted the services of Moodys for ratings and Barclays and Standard Chartered Bank.
“We closed last financial year with a turnover of Rs 1,227 crore, up 53 per cent over Rs 800 crore and expect to double the turnover this year to past the Rs 2,500 crore mark,” he said.
Referring to the proposed IPO, he said EESL is seeking to raise about Rs 200-300 crore and this would complete the equity component of Rs 1,200 crore proposed as a part of the capex plan.
Set up as a joint venture of four PSUs under the Power Ministry, EESL has been championing the cause of energy efficiency and as a super Energy Service company (ESCO).