RE firms may use rupee loans to refinance $3 bn overseas green bonds

Costly overseas funds forcing them to tap domestic sources

Green bonds

Indian RE developers have raised green bonds aggregating to $15.5 billion from abroad since 2014.

Abhijit Lele Mumbai
With global funds becoming costly, Indian renewable energy (RE) companies may use domestic rupee loans to refinance green bonds worth $3 billion due for repayment in FY24 and FY25.

The refinancing of overseas green bonds is expected to happen at rates higher than the prevailing interest rates, leading to moderation in the credit metrics. Nonetheless, the impact on the Debt servicing for refinancing using a domestic rupee debt is expected to be lower than issuing fresh dollar green bonds to refinance the existing bonds, according to rating agency Icra.

The $300 million due for repayment in FY23 had already been repaid by the developer through proceeds from an earlier bond issuance.

First Published: Dec 19 2022 | 9:01 PM IST

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