Sajjan Jindal-controlled JSW Energy is planning to raise up to $1 billion in a maiden dollar bond sale, seeking to catch up with rivals such as Adani and the Tatas in expanding its footprint in clean energy projects. These would be the so-called green bonds, compliant with the crucial ESG (Environment, Social and Governance) theme.
The company will likely use the proceeds to fund the acquisition of solar projects in South India and to refinance high-cost rupee debt taken for the Jaypee Himachal deal, said three people with direct knowledge of the matter. “The company is seeking to raise about $700 million to $1 billion by June, tapping into the global pool of liquidity,” one of the persons cited above told ET. JSW declined to comment.
The proposed fundraising could take place in one or two tranches. JSW is currently in talks with a group of investment bankers and the final terms are not yet fixed.
ESG bonds are gaining popularity this year with many Indian companies including Delhi International Airport (DIAL) and Hero Future tapping the offshore market.
India Ratings rated JSW Energy’s local bonds as AA- with a stable outlook. It hasn’t yet obtained ratings from global rating firms.
JSW Energy reported high plant availability of 84 per cent in 9MFY21 for its Barmer plant, 90 per cent for Ratnagiri for the tied-up capacity, 85 per cent for Vijayanagar for the tied-up capacity, ensuring the entire fixed cost recovery to the extent of PPA (Power Purchase Agreement).
The US Treasury benchmark has trebled to 1.63 per cent now since August last year. The gauge, used mostly to price offshore bond sales, is still less than half of the October 2018 peak.
The company has a total debt of Rs 9,840 crore of FY20 of which it reduced net debt (excluding working capital) by Rs 2,226 crore in the nine-months ending December 31.
In 2014, JSW Energy bought two hydroelectric projects from Jaiprakash Power Ventures (JPVL) for Rs 9,700 crore in cash. The company availed credit lines to fund the acquisition. There are three projects including Baspa Stage II (300 MW) and Karcham Wangtoo (1,091MW), both in Himachal Pradesh.
