ReNew To Raise Up To $400 Million Via Corporate Bonds

Diamond II Ltd, a unit of ReNew Energy, has hired Barclays, Deutsche Bank, HSBC, JP Morgan, Standard Chartered Bank and BNP Paribas as joint global coordinators, said Kedar Upadhye, group chief financial officer at ReNew.

The renewable energy firm would now conduct roadshows for the bond, sale backed by its corporate guarantee.

The bonds have been certified by the Climate Bond Initiative, a non-profit promoting investment in climate change solutions, and are in accordance with the International Capital Market Association (ICMA) Green Bond Principles, a set of guidelines that ensures the bonds are used for environmentally sustainable projects.

A guaranteed bond provides an additional assurance that in the event of issuer default due to factors like insolvency, a third party will fulfil interest and principal payments. This arrangement enables the issuing company to pay lower interest rates compared to non-guaranteed bonds.During FY23, ReNew repaid over $1 billion to its offshore bondholders. Over the past fiscal year, the Nasdaq-listed firm refinanced $525 million of bonds in domestic markets prior to their March 2024 maturity, along with a $300 million repayment from its internal cash accruals.

ReNew has a clean energy portfolio of 13.4 gigawatts (GW) on a gross basis as of 30 September, 2022. The fundraising plan coincides with ReNew’s plans to broaden its operations within the renewable energy sector. This February, it underwent a rebranding from ReNew Power to ReNew, signifying its evolution from a pure-play renewables firm to an all-encompassing provider of decarbonization solutions across clean energy, green hydrogen, energy storage, and carbon markets.

Last month, Canada Pension Plan Investment Board (CPPIB) agreed to buy Goldman Sachs’ stake worth $268.6 million, making the Canadian pension fund the majority shareholder in ReNew. The transaction was at a per-share price of $4.8. ReNew has also planned to sell a minority stake in its commercial and industrial projects for about $300 million as part of its capital recycling strategy.