Azure Power Global Limited, a New Delhi-based renewable power producer, has issued a five-year green bond to raise US$414 million. The bond, issued by Azure Power Energy Ltd (a wholly-owned subsidiary of Azure Power Global), will mature in 2026 and will pay investors at a coupon rate (annual interest) of 3.575%.
The coupon rate is the lowest ever in the high-yield RE segment for any business out of India and is lower by 27.5 basis points (bps) from the lowest offering from any Indian renewable energy company to date.
The bond is the third solar Green Bond offered by Azure Power Group after issuances in 2017 and 2019. The company will primarily use the proceeds to refinance its existing 5.50% US$500 million Green Bond issued in 2017 and due in 2022. It is also expected to reduce debt cost by over 200 basis points in hedged INR terms for its 611 MW operational solar projects portfolio offered under the bond.
“The order book saw bids in excess of US$ 2 billion, with more than 60% of the issuance placed with US and European investors, thereby demonstrating global recognition of credit and operational strength of the Group. The transaction also underscores Group’s continued ability to raise debt capital at a lower cost compared to its peers, leading to significant improvement in the overall return profile of the Group,” stated the company.
Barclays, HSBC, Standard Chartered Bank, Credit Suisse, and MUFG were the Joint Global Coordinators and Bookrunners for the transaction along with Jefferies, Roth Capital Partners, Société Générale, and ICICI Bank as the Joint Bookrunners.
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