REC Limited, a non-banking finance company under the Ministry of Power, announced that it has successfully raised JPY 61.1 billion (around INR 3,500 crore) through the issuance of green bonds. Its inaugural JPY 61.1 billion 5-year, 5.25-year and 10-year green bonds were issued under its US$ 10 billion Global Medium Term Notes Programme. Proceeds from the issue of the bonds will be applied to finance the eligible green projects in accordance with the Company’s Green Finance Framework, RBI’s ECB Guidelines and the approvals granted by it from time to time.
The transaction marks REC Limited’s eleventh venture into the international bond market and inaugural Yen Bond issuance. It is also the first Yen green bonds issuance by any Indian PSU. The bonds were issued at yield of 1.76%, 1.79% and 2.20%, respectively.
The issuance also marks largest ever Euro-Yen issuance in South and South East Asia, largest Yen-denominated issuance from India, and largest non-sovereign Yen-denominated issuance ever from South and South East Asia. The transaction witnessed interest both from Japanese and international accounts with number of orders from each at 50%, international allocation being one of the highest for any other Indian Yen deal.
Vivek Kumar Dewangan, chairman & managing director, REC Limited said, “As a frequent issuer in the international debt capital markets, we are always in the lookout to tap new markets and further diversify our funding sources. We are delighted to successfully price our inaugural Euro-Yen Green bonds, which reaffirms REC’s position as an established issuer with deep access to global funding, while maintaining the overall cost of funding lower than the industry standards.”
The notes will be rated Baa3/BBB–/BBB+ (Moody’s/Fitch/JCR) and will be listed exclusively on Global Securities Market of India International Exchange (India INX) and NSE IFSC in GIFT City, Gandhinagar, Gujarat. DBS Bank, Mizuho, MUFG, and SMBC Nikko are the joint lead managers for the issue.
REC finances the entire power-infrastructure sector comprising generation, transmission, distribution, renewable energy and new technologies like electric vehicles, battery storage, pump storage projects, green hydrogen, green ammonia projects etc.
More recently, REC has also diversified into the non-power infrastructure sector.
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