EESL Raises Domestic Bonds to Fund Energy Efficiency Projects in India AA Rating by Both ICRA and CARE- (Press Information Bureau) (20 Sep 2016)
MANU/PIBU/0773/2016
Electricity
Energy Efficiency Services Limited (EESL) has made its maiden issuance of bonds in the domestic market to fund energy efficiency projects in India. Domestic bonds worth Rs. 500 crore were issued to investors on private placement basis at a coupon rate of 8.07% per annum. These bonds have been rated AA by ICRA and CARE. The maturity of the bonds range from 3.5 to 7 years on STRPP basis. Meanwhile, Trust Investment Advisors is the sole arranger of the issue. The bonds are proposed to be listed in WDM segment of the Bombay Stock Exchange. The issuance has been fully subscribed showcasing the faith investors have in the energy efficiency business of the company.
The access to Indian bond markets will be a key milestone for EESL to channelize more investments in the energy efficiency market. For FY 2016-17, the capex requirement of EESL is Rs.3500 crore. Aiding this requirement, these corporate bonds will be the first of many tranches. EESL is also planning to introduce Green Masala Bonds worth USD 100mn (approx. Rs.700 crore) in November. The company has also tied up funding from multi-lateral agencies like KFW, AFD and ADB for funding its energy efficient projects.
EESL aims to unlock the energy efficiency (EE) and demand side management (DSM) market valued at Rs. 1.5 Lakh crore, and implement large-scale EE projects. It seeks to create market access, particularly in the public facilities (municipalities, buildings, agriculture, industry etc.), implement innovative business models, handhold private sector Energy Service Companies (ESCOs) in an effort to ensure replication. For the year ended March 31, 2016, the company reported total revenue of Rs.715.65 crore and profit before tax (PBT) of Rs 48.12 crore compared to total revenue of Rs.71.10 crore and a PBT ofRs.13.57 crore in the previous year.
EESL has implemented energy efficiency programs in domestic and street lighting, buildings, agriculture, etc., at a scale, which no organization has been able to achieve. The growth of the company during FY 2015-16 has been 10 times in terms of turnover as compared to FY 2014-15. The growth is built on careful design of projects in consultation with stakeholders, robust business models, structured strategy of market aggregation, transparency in operations, addressing barriers for different programs and a professional team of 450+ dedicated officers. With strong linkages to national policies such as NMEEE, UDAY, 24X7 Power for All, EESL seeks to create market access for energy efficiency, particularly for domestic consumers and public facilities like municipalities, buildings, agriculture, industry, etc.
Tags : DOMESTIC BONDS PROJECTS FUND RAISING
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