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    NTPC plans to mop up $250 million via green masala bonds

    Synopsis

    NTPC is planning to tap into the offshore masala bond market to raise $150-250 million, said one of the persons, who did not wish to be identified.

    ET Bureau
    MUMBAI: NTPC is planning to sell rupee-denominated offshore green bonds to raise up to $250 million by the end of July as part of efforts by India’s biggest power producer to enter renewable energy business. If this happens, the state-run company will break almost a year-long jinx to emerge as the first issuer of such bonds that were given the go-ahead by the regulator last year. “We are exploring all options including green masala bonds,” NTPC’s director-finance Kulamani Biswal told ET. “We have capex requirement of about Rs 30,000 crore in FY17.

    We will be raising funds through a combination of international and domestic bonds as well as internal resources,” he said. With a growing thrust on clean energy such as solar and wind power, NTPC is eyeing the “first seller” tag in the rupee-denominated overseas bonds category, said two people familiar with the matter. They said the company is likely to have appointed investment bankers such as Barclays, Deutsche Bank, HSBC and SBI Capital Markets.

    NTPC is planning to tap into the offshore masala bond market to raise $150-250 million, said one of the persons, who did not wish to be identified. In the current fiscal, NTPC may seek to raise $3-4 billion in all from the offshore market, he said.

    In an interview to ET last week, NTPC chairman Gurdeep Singh said that the company had revised its corporate plan to add more wind and solar power projects to its portfolio. The company plans to add 2,500 MW of conventional capacity and at least an equal amount of renewable plants every year, he said. The government has set a target of producing 175 gigawatt clean power by 2022. Power generators such as NTPC can play acrucial role in this endeavour.

    “A large funding requirement, be it for capex, acquisition finance or any other large liquidity event may drive the search for new investors or structures,” said Amrish Baliga, head - corporate finance, Deutsche Bank. “A masala bond or potential green investors may permit a bit more leeway on pricing for that tranche,” he said.

    The issuer can also tap into dedicated global green bond investors that are concerned with protecting the environment.



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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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