Financing activity has picked up pace in the power sector driven by India’s ambitious plans of achieving 450 GW by 2030. In the past year, the sector has witnessed some significant fundraisings through commercial loans and green bond issuances. For global investors, India remained a priority market for renewable energy growth. Power Line presents a round-up of the major financing moves during the past 12 months…
Mergers and acquisitions
The sector witnessed several big-ticket merger and acquisition (M&A) deals in the past 12 months, especially in the clean energy sector. These included JSW Energy Limited’s acquisition of Mytrah Energy (India) Private Limited’s 1.8 GW renewable energy portfolio and Adani Green Energy Limited’s (AGEL) acquisition of SB Energy India for Rs 260 billion.
Major loan agreements
In the past 12 months, several key players in the power sector have secured sizeable loans and funds for diverse purposes such as project development and fund acquisitions. Some prominent agreements included REC Limited’s $1,175 million loan raised from a consortium of seven banks, SJVN Arun-3 Power Development Company’s Rs 63.33 billion term loan agreement with banks from India and Nepal, as well as Reliance Industries Limited’s (RIL) $736 billion green loan to fund an acquisition.
Bond issuance
It was a gainful year for the power sector in the bond market. A number of key market players issued bonds in the last 12 months for the purpose of refinancing and raising funds. Major players issued green bonds in both national and international stock markets.
Equity moves
The year witnessed some major initial public offering (IPO) announcements by Inox Green Energy and Vikram Solar. The segment also saw some notable equity investments with foreign investors picking up stakes in majors such as Tata Power, Reliance Power, AGEL and Apraava Energy.
Multilateral finance deals
The power sector saw a number of multilateral deals for power infrastructure development with international organisations and banks such as the World Bank, the International Bank for Reconstruction and Development (IBRD) and KfW Developmental Bank.
Stressed assets
There has been steady progress in the resolution of stressed assets, which has been prioritised by several players in the past year. The National Company Law Tribunal (NCLT) initiated and approved multiple resolution plans for distressed assets and some of the stressed assets were also acquired by key players in the sector.
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