JSW Hydro Energy raises $750 mn from green bond sale/ Representational Image
JSW Hydro Energy raises $750 mn from green bond sale/ Representational Image
Photo by Anete Lusina from Pexels

JSW Hydro Energy, an arm of Sajjan Jindal-led JSW Energy, has raised USD 707 million (about Rs 5,200 crore) through its maiden international green bond sale that was oversubscribed by four times, merchant bankers said on Monday.

This is the largest green bonds sale by a domestic issuer, according to the merchant bankers and also the first such issue this fiscal.

When contacted JSW Group refused to comment, citing regulatory compliance.

The USD 707 million 10-year money was priced at 4.125 per cent over the US treasury at closing, down from the initial guidance of 4.50 per cent, as the issue had a huge investor demand of four times the issue size, the merchant bankers said.

JSW Hydro Energy successfully raised USD 707 million in a green bond sale from international investors, as per merchant bankers.

The Regulation-S (Reg-S) bonds (which are denominated in US dollars and sold to non-resident American investors) was oversubscribed four times, helping the issuer tighten the coupon from an initial guidance of 4.5 per cent to 4.125 per cent over the US treasury at closing, Deutsche Bank India, which was the sole lead book runner to and the green structuring agent of the issue, told PTI.

Majority of subscribers are high-quality long-only investors, it added.

The strong response to the issue, especially in the current environment, is a testament to the quality of the issuer and the confidence that oversees investors continue to repose in high-quality Indian issuances, Amrish Baliga, a managing director at Deutsche Bank India, told PTI.

He said the key point to note is that it comes at a time when foreign portfolio investors are pulling out from the domestic fixed income market, making it a blowout success. Over-subscription of four times in this environment is much higher than some issues even before the pandemic crisis.

The company was planning to raise USD 750 million in 10-year senior secured green bonds but finally chose to pick only USD 707 million, the bank said.

Other merchant bankers include Standard Chartered Bank, JP Morgan and Barclays India.

JSW Hydro Energy has an installed generation capacity of 1,391 MW. The group as a whole has 4,559 MW capacity, of which 3,158 MW are thermal power and 10 MW solar power.

Its operations across the country and have stakes in natural resource companies in South Africa.

The company's biggest hydel asset is Himachal Baspa Power Company, which it had acquired in 2015 for Rs 9,275 crore from Jaiprakash Power Ventures. The acquisition has given JSW Energy complete control over the 300 MW Baspa II and 1,091 MW Karcham Wangtoo hydro electricity projects.

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