Public sector energy cos to launch Masala Bonds for UK investors
21/04/2016 13:01
As India gears up to meet its ambitious renewable energy targets of 175 GW of installed capacity by 2022, the country is exploring international mechanisms of funding and is evaluating new and innovative tools to finance the renewables sector, says a CII report. As a step in this direction, Indian public sector giants are likely to examine rupee denominated debt instruments like Masala Bonds to create and develop a new market and identify benchmark prices for these new instruments, said the report. The issuances which would be offered by blue chip government companies is expected to help evolve new vistas of funding for the renewable energy space, it said. “Companies including NTPC, Neyveli Lignite Corporation, Power Finance Corporation, Power Trading Corporation and Rural Electrification Corporation are likely to launch these Masala Bonds totaling USD 1 billion in the next three or four months in the UK to gauge the investor appetite. The tenor of these bonds is likely to be limited to a band of five to seven years and these are going to be in smaller denominations ranging from USD 150-250 million. These will be subject to decisions made by the Boards of the PSU energy companies. In addition, Energy Efficiency Services Limited could explore issuance of Green Masala Bond subject to credit rating. ,” said Piyush Goyal, Minister of State for Power, Coal and New and Renewable Energy, Government of India. He was speaking at a Round table, “Financing Renewables and Energy Efficiency” organized by the City of London in London on Wednesday. In 2015, IFC issued the first Masala bond listed on the London Stock Exchange. The bonds worth over Rs 1000 crore were issued in a range of tenors, including a ten-year, 10 billion rupee-denominated bond to raise funds for infrastructure projects. Masala bonds are primarily rupee denominated bonds issued to overseas buyers.
21/04/2016 13:01
