Clean energy arm of Hindustan Power projects first to place credit enhanced infrastructure bond

  • Rs. 380 Crs Issue fully underwritten by Yes Bank Limited


New Delhi, 24 Sep 2015: The Clean energy arm of Hindustan Power achieved the distinction of becoming the first and largest Indian solar 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. 380,00,00,000 (Rupees three hundred and eighty crore) (“Debentures“) on a private placement basis to YES Bank Limited for three of its AA+(SO) rated projects in, Gujarat.
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.
Speaking on this occasion, RatulPuri, Chairman, Hindustan Power Limited, said, “The clean energy arm has had many firsts in the Indian solar sector. We are happy to continue with the tradition and be the first and largest solar player to enter the credit enhancement bond market. We are thankful to IIFCL, ADB and YES Bank Limited and are happy to partner them in opening up the long term capital market funds for infrastructure sector in the country. 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.”
Mr. Sanjay Palve, Group President, YES Bank said “This Bond issue has paved the way towards accelerating development of a corporate bond market for the infrastructure sector and would create a new asset class of investors such as insurance companies and pension funds in the country. YES BANK is pleased to announce its participation in India’s first rated listed and secured credit enhanced bond in the solar power sector on fully underwritten basis. YES Bank was also the first Bank to issue country’s maiden Green Bond. I would like to compliment IIFCL, ADB and Hindustan Power Group for this maiden Bond issue in the solar power sector.”
Mr. Santosh B Nayar, Chairman & Managing Director, IIFCL said “IIFCL has always been providing innovative financing solutions to the infrastructure sector. Earlier IIFCL introduced the Takeout Financing Scheme. Credit Enhancement has been a very important initiative of the Government and it would help the infrastructure sector in raising funds through Debt Capital Markets. While this initiative would not only help in addressing the challenges which the commercial banks face like ALM, Capital adequacy and exposure but would also help the infrastructure projects in reducing their cost of debt” said Santosh B Nayar, Chairman & Managing Director, IIFCL.



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