ReNew Energy Refinances its Dollar-Denominated Bonds from Indian NBFC
The bonds worth $525 million were to mature in 2024
July 13, 2022
Renewable energy producer ReNew Energy Global announced that it had refinanced its 2024 maturity dollar-denominated bonds with amortizing project debt from an Indian non-banking financial company (NBFC).
By refinancing the dollar-denominated bonds ahead of time, ReNew said it had shown strong and continued access to domestic debt and an ability to proactively manage the risk of refinancing.
ReNew claimed it is the first Indian renewable energy company to raise money onshore to retire its dollar-denominated bonds.
ReNew issued bonds worth $525 million in 2019, which were set to mature in 2024. The refinancing has cut the bonds’ Indian rupee interest cost by 200 basis points, with the interest rate fixed for three years while pushing the maturity to the end of the fiscal year 2027.
The rate reduction, rate fixing, and tenor extension have taken place against a rising interest rate environment in the broader markets. The company said this pre-emptive refinancing has mitigated near-term refinancing risk for bonds and provides liquidity to bond investors.
“As we help spearhead India’s energy transition, we have mitigated refinancing risk without depleting the company’s growth capital and will continue to look at multiple pools of capital to further abate refinancing risk,” said Kedar Upadhye, CFO, ReNew.
In January, ReNew announced that its wholly-owned subsidiary India Clean Energy Holdings, raised $400 million by issuing senior secured dollar notes. Climate Bonds Initiative certified the notes as green bonds. The bonds have a tenor of 5.25 years.
ReNew’s total portfolio across the utility-scale wind, solar and hydro projects recently surged over 25% to ~12.8 GW from 10.2 GW. In June this year, ReNew signed definitive agreements to acquire over 500 MW of wind and solar projects.
ReNew, Adani Green, and Azure were the top three utility-scale solar developers in 2021.
ReNew also signed 2.5 GW of power purchase agreements that comprise 1.6 GW for new projects and 528 MW of acquisitions, thus bringing the gross portfolio to 12.8 GW.
The company also increased its module manufacturing capacity to 6 GW anticipating opportunities to capitalize on higher return development projects as a module shortage is expected to emerge in India shortly.
Vijayalakshmi Sridhar
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