India Infradebt Ltd (IIL), an ICICI Bank-backed infrastructure refinance company, plans to Rs 3,000 crore through debentures to fund renewable energy projects as part of its business expansion plans.
Till date, IIL, a non-banking finance company (NBFC) regulated by the Reserve Bank of India, was providing refunding support to roads projects that too running under public-private partnership (PPP). This was in line with RBI’s rule permitting IDF-NBFCs to invest in debt securities of only PPP infrastructure projects with a Project Authority like National Highway Authority of India (NHAI).
The project could become eligible for refinance only after completing one year of commercial operation.
Now, RBI has eased the norms for IDFs (Infrastructure Development Funds) and allowed them to make investments in PPP projects without a project authority and non PPP projects with minimum one year of commercial operations.
Also earlier, for each exposure, IDF-NBFCs have had to be party to a tripartite agreement with the concessionaire and the project authority for ensuring a compulsory buyout with termination payment. RBI has relaxed this condition as well.
ICICI Bank group holds 31 per cent stake, while Bank of Baroda has 30 per cent. Citicorp Finance India holds 29 per cent and Life Insurance Corporation of India balance 10 per cent.
ICRA has assigned "AAA " rating with stable outlook to the non-convertible debentures (Rs 3,000 crore).
The company currently has an exposure of Rs 1,558 crore outstanding as on 12 projects. The portfolio comprises of operational PPP projects in the road sector with tripartite agreements with the NHAI. Of these, 10 are toll projects and the rest are annuity projects.Besides roads, will fund renewable energy projects
Infradebt had total borrowings of Rs 1,170 crore as on December 15 (Rs 710 crore as on March 15).