Greenko raises $450 mn, to set up 11 GW integrated renewable projects

Company recently acquired 1 GW projects of Gujarat-based Orange Renewables for $1 bn, making it India's second largest renewable company

Hyderabad-based Greenko Group has raised $450 million for investing in its new business model -- setting up integrated round-the-clock renewable energy projects. Company sources said it will set up close to 11 Gw of hydro along with solar or wind and storage facility.

GIC, which already has 60 per cent stake in the company along with Abu Dhabhi Investment Agency (ADIA), has pumped in $450 million in Greenko. The company recently acquired 1 GW projects of Gujarat-based Orange Renewables for $1 billion making it the second largest renewable company in India with cumulative asset base of 4.2 GW.

Sources said the funds would be used to set up projects on standalone basis with no government bidding involved. However, it will participate in bidding of wind/solar+storage projects as and when government brings out the tender for the same. 

“The increasing proportion of renewable energy in the grid has not been as same as growth of base load which is coal and flexible base load i.e. hydro or gas. This in near future would lead to imbalance in the grid. Thereby the company in order to optimally utilise the renewable sources is looking at integrated projects,” said an executive requesting anonymity.

Founded by Mahesh Kolli and Anil Kumar Chalamalasetty in 2006, Greenko raised initial funding from GIC. The company's balance sheet valuation stands at $5.5 billion as on March 2018, said a market source. GIC is the largest stakeholder followed by the two promoters and ADIA. 

In 2016, Greenko made one of the largest acquisition in Indian renewable energy sector by taking over Indian assets of American company SunEdison for an enterprise value of $390 million. 

Greenko ventured in the clean energy space with hydro power and currently has 500 Mw of operational hydro power projects. 

“Renewable cannot replace base load but the base has been inadequate. The company wishes to provide 24*7 renewable availability without hampering grid balance. The idea is to provide renewable along with flexible base load of hydro and/or storage facility,” said a senior executive.

The company which was earlier in race to buy the power distribution arm of Reliance Infra in Mumbai is actively looking in the transmission & distribution segment. 

Company sources said the firm is likely to participate in bidding for transmission projects. It might also look to make standalone investments in the transmission space, apart from exploring opportunities for investing in power distribution through franchisee, ownership and licensee.