ReNew Energy Global, an Indian renewable energy developer, announced that its wholly-owned subsidiary, India Clean Energy Holdings, raised $400 million by issuing senior secured dollar notes at a rate of 4.5 per cent. The dollar notes have been recognised as green bonds by the Climate Bonds Initiative. Also, the bonds will be listed on the Singapore Exchange. The tenor of the green bonds is 5.25 years.
Reportedly, the funds raised through these bonds will be used by the company’s subsidiary to restructure current high-cost debt and fund capital expenditure in renewable energy assets, among other things. Around 40 per cent of these notes were subscribed by investors from Asia and the US, with the remaining notes being subscribed by investors from Europe, the Middle East, and Africa. The majority of the notes were purchased by pension funds and long-only fund managers.
So far, the renewable energy provider has raised about $3.5 billion through its subsidiaries in eight green bond issuances, seven of which are still outstanding. In December 2021, Larsen & Toubro and ReNew Power formed a partnership to capitalise on India’s growing green hydrogen market. L&T and ReNew will jointly develop, own, execute, and operate green hydrogen projects in India under this arrangement.
REGlobal’s Views: Green bonds have emerged as a popular option for large Indian renewable energy firms to raise funds and the green bond market is expected to keep growing provided there are targeted efforts by the Indian authorities to improve the attractiveness and regulations in this space.