India’s NTPC issued USD-300m green bond


New Delhi: Indian power producer NTPC Ltd (BOM:532555) has launched an INR-20-billion (Rs 2,000 crore ), green masala bond issuance to support wind and solar energy projects, it said Thursday. "Issue of rupee-denominated Rs 20,000 million 7.375 per cent notes due 2021 payable in US dollars was launched pursuant to USD 4 billion medium term note programme," NTPC informed BSE in a statement today.

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Power Minister Piyush Goyal tweeted, "Congrats to NTPC for issuing first green masala bonds at 20 bps lower than domestic AAA benchmark." The 5-year bond has a coupon rate of 7.375 per cent and yield of the 7.48 per cent, which is 20 basis points lower than domestic AAA 5-year benchmark yield today.

The proceeds will be used for financing renewable projects and bonds will be listed in London and Singapore, he added. According to statement, the bonds were priced yesterday and all payments for securing bonds will be settled by August 10.

The masala bonds are rupee denominated bonds where the investor takes the currency fluctuation risk while the borrowers don't bear the risk. In dollar bonds, the borrower bears the currency fluctuation risk. NTPC has drafted its business plan of capacity addition of about 1,000 mw through renewable resources by 2017. It has already commissioned 310 mw solar projects.

The ones under implementation include Anantpur in Andhra Pradesh, Bhadla in Rajasthan, Mandsar in Madhya Pradesh and 8 mw small hydro projects. NTPC has envisioned 128 gw of total power generation capacity by 2032, with 28 per cent from renewable energy sources. 

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