Finance News

Japan’s Orix To Invest `7200 Cr In

Greenko for 20% stake

Diversified Japanese financial conglomerate, has made the largest single renewable energy investment into India, with a $980 million ( Rs 7200 crores) on renewable major Greenko Group Holdings. The deal is expected to be closed by the end of the year.

The Tokyo based firm had $23.6 billion

in reported revenues last year, making the Greenko bet one of its largest investments anywhere outside Japan.

For the Hyderabad-based Greenko Group, founded by Anil Kumar Chalamalasetty and Mahesh Kolli in 2004, the investment by Orix follows previous investments from sovereign wealth funds GIC Investment of Singapore, and the Abu Dhabi Investment Authority, that have together pumped in over $2.2 billion in the firm. While GIC owns 65.8 percent in the firm, ADIA owns 16.5 percent. After the transaction closes, the promoters are expected to be left with around 13 percent stake in the firm.

Orix, according to its statement, will integrate its existing wind energy business (873 MW) with Greenko, as part of the transaction, where it will be buying most of its stake from the promoter’s equity, besides a fresh issue of shares. The deal will make Greenko the second most valuable renewable energy firm in the country with a valuation of over $6 billion, after the publicly listed Adani Green Energy, which has had a spectacular run on the equity markets recently, to take its own valuation to almost $13 billion. French energy major Total is the major partner at Adani Green Energy.

Greenko, with an existing capacity of 4 GW, and a pipeline of over 8 GW, was probably one of the few firms that offered an opportunity to invest a significant amount, to the Japanese firm.

Fourth Partner Energy Raises `126 Crore to Expand Project Portfolio

Fourth Partner Energy, sustainable banking majors, otherwise been a challenging one of India’s leading Triodos Bank and ASN Bank. year, will allow us to execute solar solutions firm for This bond marks the these projects and adhere to corporates, has announced consortium’s foray into our client commitments. We that it has raised USD 16 India’s commercial solar will be utilising these funds million (~ Rs 126 crore) in sector. The firm will utilise for expanding our mezzanine funding from a these funds towards the distributed solar footprint. consortium of European construction of around 150 We are delighted to welcome impact investment funds, led MW worth of new solar Symbiotics, Triodos and ASN by Symbiotics. This is the assets. as our Fourth Partners!” second round of funding Pradhyum Reddy, Head – The Hyderabad based firm announced by the firm this Corporate Finance at Fourth has an operational portfolio fiscal after responsAbility Partner Energy said, “this are working hard to bring into of 400 MW of solar assets Investments A.G. pumped in line of credit from marquee India high-quality global currently and is looking to USD 15 million in June. impact investors like financiers committed to the add close to 350 MW

Symbiotics, a leading Symbiotics, Triodos and ASN long-term impact of capacity this fiscal. The market-access platform for is testament to the role of distributed solar. company is also constructing impact investing, has Commercial & Industrial “We have a very healthy solar parks across Uttar arranged for the issuance of customers driving the orderbook, and these two Pradesh, Maharashtra and this bond in partnership transition to clean energy. At rounds of funding in quick Tamil Nadu as part of its with Netherland’s Fourth Partner Energy, we succession, in what has Open Access portfolio.

Sterling and Wilson Q1 2020-21 Results. Familiar Problems Continue To Dog Numbers

Sterling and Wilson Solar declared its results for Q1 of the financial year 2021-21. The firm’s legacy problem of timely debt repayment from its promoters, despite assurances after the previous quarter results and analyst calls, continues to fester, something that will not inspire confidence at all. On top of that, the ‘lumpiness’ of earnings as an EPC player, combined with the Covid outbreak, has ensured that the firm has struggled for the quarter.

Total income for the April may June period (Q1) period, at Rs 1099.38 crores, is a drop of 16 percent over the previous quarter (Q4) , while profit dropped 60 percent drop over the corresponding quarter of 2019-20 atRs 17.22 crore. Consolidated net profit was Rs 46.01 crores .

On the issue of debt repayment from its promoters where the current outstanding was over Rs 1200 cores, the firm’s auditors note that out of the June installment of Rs 500 crores, only Rs 103.47 crores could be arranged by the promoters, leaving a further Rs 396.7 crores pending. The promoters were to repay another Rs 500 crores in September. Considering the situation, the board has seen fit to extend the period of repayment to September 2021 now, with a further 400 basis points added to the interest rate on the total outstandings, besides exploring ways to further secure the amount by way of securities offered by the promoters.

A silver lining has been the continued growth in the Operations and Maintainance (O&M) segment revenues. The O&M revenues is one segment that the firm has high hopes on, hoping to grab both the market opportunity and the element of predictability on earnings they offer.

Adani Green Reports Strong Q1 2021, Moves Closer to 25 GW by 2025 Target

Adani Green Energy Ltd. (AGEL), a part of the Adani Group, also announced its financial results for Q1 for FY 2021. The firm reported that its total net power exports increased by 24 percent YoY on the back of capacity addition of 425 MW and steady CUF performance.

The firms’ solar Capacity Utilisation Factor (CUF) remained steady at 24.8 percent, better than the P75 target of 24.3 percent, supported by strong plant availability, grid availability and solar irradiation.

While the firms’ wind CUF improved from 35.8 percent to 40.1 percent with improved plant availability and high grid availability.

The firm also stated that its revenue and EBITDA from power supply has grown by 10 percent YoY and 12 percent YoY respectively on the back of added capacities, steady Solar CUF and improved Wind CUF. While its cash profit has grown by 9 percent YoY backed by strong revenue and EBITDA performance.

A key highlight for the firm during the quarter was that it reported zero operational disruption during the COVID-19 pandemic. Operations, the firm claimed, continued normally with continuous off-take of energy during the COVID-19 pandemic with no material curtailment on a portfolio basis on the back of ‘mustrun’ status given to renewable plants in India and electricity being classified as an ‘essential service’ during lock-down.

Nearly `12,000 Crore Spent on RE Projects Over Last 3 Fiscals: RK Singh

Union Minister for Power and New & Renewable Energy RK Singh has confirmed that nearly Rs 12,000 crore (Rs 11,787.69 crore) has been utilised for the development of renewable energy (RE) projects in the country over the last three fiscal years i.e. 2017-18, 2018-19 and 2019-20.

In a written response to a question raised in the upper house of the parliament, the minister said that “the Government has set a target of installing 175 GW renewable energy capacity in the country by 2022. As against this target, a cumulative renewable energy capacity of 88.79 GW has been installed in the country upto August 2020.”

The minister also provided details of the amount of funds allocated and utilised for the development of RE projects during the last three fiscals.

According to the data provided, the centre has allocated Rs 4080 crore in 17-18, Rs 5146.63 crore in 18-19 and Rs 3891.74 crore in 19-20 for a total of Rs 13,118.37 crore over the three years. And, of that, Rs 3768.73 crore has been utilised in 17-18, Rs 4476.20 crore in 18-19, and finally 3542.76 crore in 19-20 for the total of Rs 11787.69 crore.

The minister also revealed that renewable energy generation in the country increased from 101839.48 Million Units in 2017-18 to 138318.66 MUs in 19-20. An increase of 36479.18 MUs in the three-year period.

Answering another question, the minister said that most of the grid-connected renewable energy projects in the country are being implemented by the private sector developers selected through a transparent competitive bidding process.

Verizon Prices Second Green Bond, to Fund Renewable PPAs

Verizon Communications has announced the pricing of its second Green Bond offering which follows its recent completion of the allocation of its first Green Bond and solidifies its position as a telecommunications industry leader in green finance. The firm has tapped two nationally recognized African-Americanowned investment banking firms, Loop Capital Markets and Siebert Williams Shank, as lead underwriters, further strengthening its long-standing partnership with minority-owned businesses. Joining them as lead underwriters are BofA Securities and Citigroup.

The company expects to use the net renewable energy. It has set two ambitious company to have completed a Green Bond. proceeds of the USD 1 billion offerings goals: to source or generate renewable While Verizon has had a long history of primarily for long-term renewable energy energy equivalent to 50 percent of its total partnering with diversity firms on capital purchase agreements which support the annual electricity consumption by 2025 market transactions, today marks an construction of solar and wind facilities and be carbon neutral in its operations by important milestone as we partner with that will bring new renewable energy to 2035. minority- and women-owned firms as lead the grids that power its networks. “Verizon’s second green bond affirms underwriters to execute such an

The telecommunication major has been our commitment to take responsibility for important transaction for Verizon,” stated supporting the transition to a greener grid protecting the environment, and Verizon Matt Ellis, Verizon’s Executive Vice by making substantial investments in remains the only US telecommunications President and Chief Financial Officer.

RK Singh Approves LoUs by IREDA, PFC, REC to be Accepted for EMDs

RK Singh, the Minister for New & Renewable Energy and Power has approved a proposal for acceptance of Letter of Undertaking (LoU)

issued by IREDA, PFC & REC in lieu of Bank Guarantees for Earnest Money Deposit (EMD) by SECI, NTPC and NHPC in the case of tenders/biddings for developing Renewable Energy (RE) projects in the country.

In a letter written to SECI, NTPC, NHPC, the Ministry of New & Renewable Energy has conveyed that SECI, NTPC, NHPC or any other implementing agency on behalf of MNRE (henceforth implementing agencies) may accept Earnest Money Deposit (EMD), in the form of Bank Guarantee(s) or ‘Payment on Order instrument’.

Singh said, “this decision of the Ministry of New & Renewable Energy will go a long way in ensuring Ease of Doing Business in the RE sector as the developers will now have one more option in fulfilling the tender requirement.”

The Ministry clarified that the ‘Payment on Order instrument’ means Letter of Undertaking from Indian Renewable Energy Development Agency Limited (IREDA) or Power Finance Corporation Limited (PFC) or REC Limited (REC) [the three non-banking financial institutions under the Ministry of New & Renewable Energy (MNRE)/ Ministry of Power (MoP)], to pay in case situation of default of renewable energy power generator in terms of tender conditions and /or Power Purchase Agreement (PPA) arises.

And that such Letter(s) will have the same effect as that of a Bank Guarantee issued by any public sector bank. Such “Payment on Order instrument” would have terms and conditions similar to that of any Bank Guarantee given by any public sector bank and would promise to pay the Procurer on-demand within the stipulated time. RE power generators can seek such Letters(s) by offering due security to the above mentioned three non-banking financial institutions (IREDA, PFC & REC).