The Tata Group company is in talks with lenders including State Bank of India, IndusInd Bank, Axis Bank and ICICI Bank for the loan, Bloomberg reported citing sources.
Loan Plan:
Tata Power plans to raise up to $1 billion-equivalent for clean energy projects.
This could be the largest local currency loan in India this year.
Lenders:
Talks are ongoing with State Bank of India, IndusInd Bank, Axis Bank, and ICICI Bank.
Current Largest Loan:
The largest local currency loan this year was $365 million by Assam Bio Refinery Pvt in February.
Tata Power's loan, if finalized near $1 billion, would surpass this.
Loan Usage:
Proceeds will fund Tata Power’s $1.6 billion investment announced in August for clean energy projects, specifically pumped hydro storage.
India’s Green Power Goals:
India aims to nearly triple its green power capacity by the end of the decade.
Companies like Tata Power, Adani Green Energy, and Reliance Industries are increasing efforts in this area.
Tata Power targets a near four-fold growth in its renewable generation capacity by 2027.
Loan Structure:
The loan could be structured as a bilateral loan or a clubbed facility.
Tata Power expects to finalize credit lines in the next three to six months.
Disbursements will occur in tranches based on project development.
The loan may be priced over local benchmarks such as the Reserve Bank of India’s repo rate or treasury bills.
Financial Performance:
Tata Power reported a 15% YoY growth in consolidated net profit to Rs 895 crore for Q4 FY24, up from Rs 778 crore in Q4 FY23.
Revenue from operations rose 27% YoY to Rs 15,846 crore.
EBITDA for the March quarter increased 15% YoY to Rs 2,332 crore, from Rs 2,028 crore in the same quarter last year.
Margins contracted by 157 basis points to 14.7% in the reporting period.
The board recommended a final dividend of Rs 2 per share for the financial year ended March 2024.
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