REC raises $500 million via green bond – EQ
In Short : REC Ltd. (Rural Electrification Corporation) has successfully raised $500 million through the issuance of green bonds. The funds raised will be directed toward financing renewable energy projects, such as solar, wind, and other sustainable initiatives. This move is part of REC’s commitment to promoting clean energy and supporting India’s energy transition goals while contributing to global climate change mitigation efforts.
In Detail : State-owned REC Ltd on Saturday said it has raised $500 million through green dollar bonds to support various renewable energy projects.
The five-year note has a coupon rate of 4.75% per annum to be paid semi-annually and the maturity date of September 27, 2029. This is the first US dollar bond issuance from an Indian public sector enterprise in 2024, REC said in a statement.
The latest fund raise was part of $10 billion global medium-term programme of the company.
The proceeds will be used to finance eligible green projects, in accordance with REC’s Green Finance Framework as per green bond principles of Climate Bond Initiative, London and RBI’s ECB guidelines, with a second-party opinion from Sustainable Fitch, it said.
“The overwhelming demand for our green bonds, amidst a challenging global financial environment, reflects the established standing of India as a key player in the green finance market,” said Vivek Kumar Dewangan, CMD of REC Ltd.
The notes will be rated Baa3/BBB– (Moody’s/Fitch) and will be listed on Global Securities Market of India International Exchange (India INX) and NSE IFSC in GIFT City, Gandhinagar, Gujarat.
Barclays, DBS, HSBC, Mizuho, MUFG, and Standard Chartered Bank are the joint bookrunners for the issue, it stated.
REC’s loan book stands at ₹5.30 lakh crore and net worth at ₹72,351 crore as on June 30, 2024.
