Azure Power refinances its 600MW Rajasthan solar project at the lowest rate of interest in its portfolio to date 

NYSE-listed Indian developer Azure Power today announced refinancing of its existing term loan of INR 23.50 billion (US$ 313 million) for the construction of a 600MW solar project at an interest rate of 7.2% per annum, fixed for 42 months. This is the lowest rate of interest for any project finance facility in terms of rupee financing for the company’s existing portfolio so far.

Azure is implementing the 600MW interstate transmission system (ISTS) connected solar project in the Bikaner district of Rajasthan through a special purpose vehicle called Azure Power Forty Three. The project was fully commissioned recently in December 2021. It is the largest solar power project in India, owned and operated at a single location by any developer. The project is allocated by the Solar Energy Corporation of India (SECI).

“Refinancing the original term loan was one of our highest priorities, even before the project was fully commissioned in December 2021. The facility will result in substantial savings in interest cost and will improve the project IRR significantly. We are overwhelmed with the response we get from the credit markets which reflects lenders’ confidence in our strong corporate governance standards, operational capabilities, and credit fundamentals,” said Pawan Kumar Agrawal, chief financial officer, Azure Power. 

L&T Finance Limited acted as the sole underwriter for this refinancing facility. 

The power generated from the project is being supplied to SECI at a tariff of INR 2.53 (US 3.5 cents) per kWh under a 25-year power purchase agreement. The project was commissioned in multiple phases, with the last 100 MW commissioned in December 2021.