Hindustan Power today said it will issue bonds worth Rs 380 crore on private placement basis to Yes Bank for three of its projects in Gujarat.
"The clean energy arm of Hindustan Power achieved the distinction of entering into the credit enhanced bond market with the issue fully underwritten by YES Bank Ltd," the company said.
Under the partial credit guarantee scheme of IIFCL, the infrastructure financing institution will provide a 'first loss' partial credit guarantee to the bondholders and has received an irrevocable back-stop guarantee with the Asian Development Bank (ADB).
Placement of these bonds besides opening a new market for financing infrastructure projects, would also significantly bring down the cost of capital for the projects.
"With the announcement of this transaction we will be refinancing the existing debt in 3 solar SPV's of ours through the placement of Rs 380 crore worth of bonds with Yes Bank at an attractive coupon of 10.05 per cent for a tenure of 10 years," Hindustan Power Chairman Ratul Puri told reporters.
This, he added, is a significant milestone for the country in its push towards achieving 100 GW of solar by 2022 and inching closer to the government's agenda of 24X7 power to all.
The power company will issue secured, rated, listed, partially guaranteed, debentures worth Rs 380 crore on a private placement basis to YES Bank Ltd for three of its "AA+ SO rated" projects in Gujarat.
Most of the infra projects are rated BBB or A while investors seek higher ratings.
The bonds will be listed on NSE.
Currently, banks provide most of the funding for infrastructure projects in India, whereas worldwide Debt Capital Markets are the major source of such financing.
