Ireda Seeks to Tap $150 Million Masala Bond for Green Power

  • Indian agency considers issuing bonds in London or Singapore
  • Ireda plans India IPO by 2018, Director of Finance Says

The state-run Indian Renewable Energy Development Agency Ltd., or Ireda, is planning to issue about $100 million to $150 million in offshore rupee bonds by November to boost lending for green power, according to a top official.

“Within the next two to three months, we’re going to issue offshore Masala bonds,” Ireda Director of Finance Satish Kumar Bhargava said in an interview in Singapore. The agency will issue the securities on either the London Stock Exchange or the Singapore Stock Exchange, he said.

As India targets 175 gigawatts of renewable-energy capacity by 2022, an almost fourfold increase from the current base of 45 gigawatt, development institutions will play a key role in directing investment. Ireda already raised 17.16 billion rupees through selling bonds in January. Bhargava said the agency also seeks credit lines from the New Development Bank BRICS.

In the financial year ending March 31, Ireda approved loans worth 78 billion rupees while disbursing 43 billion rupees to borrowers -- a 60 percent increase year on year, according to Bhargava. For the 2017 fiscal year, Ireda wants to approve 100 billion rupees with 61 billion rupees disbursed, he said.

To meet the burgeoning financial needs of the renewable energy sector and to compete with other lenders, Ireda said in July 2015 that it would move toward going public.

“An equity listing is planned in India either in 2017 or 2018,” Bhargava said.

With 100 gigawatts of solar power representing the lion’s share of India’s renewable-energy targets, Bhargava said he expects the technology will constitute half of Ireda’s lending portfolio over the next five years.

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