Hindustan Power’s clean energy arm becomes the first solar player in Gujarat to issue the bonds for solar projects


  • Rs. 370 Crs Issue fully underwritten by Yes Bank Limited for AA+ SO rated solar projects in Porbandar


New Delhi, 24 Sep 2015: The Clean energy arm of Hindustan Power has achieved the distinction of becoming the first and the largest Indian solar power player to enter the credit enhanced bond market having the Issue fully underwritten by Yes Bank Limited. With this, the clean energy arm is set to issue secured, rated, listed, partially guaranteed, debentures of Rs. 370,00,00,000 (Rupees three hundred and seventy crore) (“Debentures“) on a private placement basis to Yes Bank Limited for three of its AA+ SO rated projects in Gujarat at Porbandar. The successful placement of these credit bonds would help in releasing of long term debt from the books of the developers into bonds thereby aid in infusing much needed financial inflow into the sector.

These Debentures will be listed on the wholesale debt market segment of the National Stock Exchange of India Limited (“NSE“) pursuant to and in accordance with the Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 (as amended). Under the partial credit guarantee scheme of IIFCL, IIFCL will provide a “first loss” partial credit guarantee to the bondholders and has gotten an irrevocable back-stop guarantee with the Asian Development Bank. 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.

The climatic conditions in Gujarat ensures higher yield due to the prevalent ambient temperature. Choosing the solar projects in Gujarat from the renewable portfolio of the company, Ratul Puri, Chairman, Hindustan Powerprojects Limited, said, “Gujarat has been the hub for solar development in the country and hence continuing with our long association with the State we have placed enhanced bond market for three of our AA+ SO rated projects in Porbandar. We are thankful to YES Bank, IIFCL and ADB for sharing our vision of ‘powered India’. 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. 370 crores worth of bonds with Yes bank at an attractive coupon of 10.05% for a tenure of 10 years.  This 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.”

About Hindustan Power:

A leading player in India’s energy sector, Hindustan Powerprojects has plants in thermal, solar and hydro. The Company is developing more than 7 GW of capacity by 2020 using conventional and non-conventional energy sources in India, Europe and the USA. The Company is in advanced stage of commissioning over 5000 MW by 2017 of combined power assets at an estimated investment of INR 35,000 crores. Although the world’s fourth-largest energy consumer after the USA, China and Russia, India lacks abundant energy resources and meets its development needs by using all available resources. This understanding helped the Company focus on renewable energy for the short-to-mid term, and conventional energy for the mid-to-long term. Secured supply chains, a diversified customer base and focus on the right technology according to region ensures risk-mitigated growth.