CLP India raises Rs 220 cr from bond market for Jhajjar Power Plant

These 9.91% debentures are secured by the project asset and non-convertible, maturing in seven and eight years

CLP India, one of the prominent foreign investor in India's power sector, has issued another round of asset-specific bonds for its 1320 mw Jhajjar Power Plant (JPL) in Haryana.

The company issued debentures worth Rs 220 crore to refinance the existing foreign currency loans. These debentures are secured by the project asset and non-convertible with maturity of seven and eight years with a coupon rate of 9.91 per cent.

This is the fourth such innovative financing structure by CLP India, introduced with a focus on refinancing existing loans and expanding its asset base, said company executives.

In a conversation with Business Standard, Samir Ashta, CFO, CLP said this time, the bonds are issued independently basis the credibility of the Jhajjar plant, without the parent company CLP India's guarantee.

"The Rupee interest rate has started coming down and the premium for long term loan is very high. As the cash flow is constant, bond makes sense for the infrastructure sector in India," said Ashta.

India Ratings had assigned 'Provisional IND A+'/Stable rating to the non-convertible debentures of JPL, in July 2016.

Ashta said the company would look at a healthy mixture of debt, working capital and commercial papers to finance its projects. The loan outstanding of JPL constitutes of Rupee Term Loan (27 per cent), bonds (23 per cent) and foreign currency loan (50 per cent).

He said the company was one of the first power companies in India to issue asset-specific bonds, in April last year totalling Rs 476 core.

Among the portfolio of investors are L&T Mutual Fund Trustee Limited, ICICI Prudential Life Insurance Company Ltd, IDFC Bank Limited, SBI General etc.

CLP India is the wholly owned subsidiary of CLP Holdings Ltd, which is listed on the Hong Stock Exchange and is one of the leading investor-owned power businesses in Asia.

It is one of the largest foreign investors in the Indian power sector with a total committed investment of over Rs 14,500 crore in renewable energy, supercritical coal and gas fired power plants, amounting to over 3,000 mw.

CLP entered the Indian power sector in 2002 with the acquisition of a 655 MW gas fired power plant which is located in Bharuch, Gujarat.