Funds Raised via Green Bond Issue to be Used for Renewable Energy Projects Only: REC

Funds Raised via Green Bond Issue to be Used for Renewable Energy Projects Only: REC

The Rural Electrification Corporation (REC) management spoke to CNBC-TV18 from London on the listing of the company’s Green Bond Issuance. The 10-year dated green bond raised USD 450 million, with an annual yield of nearly 4 percent on the London Stock Exchange’s new International Securities Market.

Throwing more light on the above development, PV Ramesh, CMD, REC said the issue received an overwhelming response and was oversubscribed 6 times.

He said they managed to raise USD 450 million of Green Bond with a tenor of 10 years and it was a first ever issue by an Indian corporate for a 10 year tenor. The money raised would be used for financing renewable energy projects only, he said.

The issue saw participation from Asia, North America and European investors.

Rural Electrification Corporation Limited (REC), a listed Navratna Public Sector Enterprise under Ministry of Power, Government of India, was incorporated on July 25, 1969 under the Companies Act 1956. REC is a Non-Banking Financial Company with ‘Infrastructure Finance Company’ status with the main objective to finance and promote power sector projects all over the country.

Ramesh said they intend to grow their loan book by 20-25% in FY18, adding that the current loan book stands at Rs 2.04 lakh crore, he added.

He said margins for the company have been at 3.5 percent and the net interest margins have been in the range of 4.4-4.6 percent and would remain over 4 percent in the next 3-4 years.

Source Link – Money Control

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