Indian renewable energy company ReNew Power has returned to the green bond market, raising US$585 million from international investors. The 144A/Reg S 7.25-year (non-call for 2.5 years) offering had an initial price guidance of 4.75% but it tightened to 4.50% amid strong demand. The final orderbook peaked at just over US$1.23 billion across 102 accounts.
In terms of investor breakdown by region, most of the demand originated from Asia, which took 44% of the offering, followed by EMEA at 32% and the United States at 24%.
Fund managers formed the bulk of the demand, taking 87% of the bond. Insurance companies, pension fund and sovereign wealth funds took 11% while private banks accounted for 2%.
Joint global coordinators and joint bookrunners in the transaction were Barclays, HSBC, J.P. Morgan and Nomura, while Standard Chartered also acted as a joint bookrunner. The green bonds were certified by Climate Bonds Initiative and verified by KPMG.
It was the latest sustainability-themed fund raising aimed at supporting the company’s green projects. Last month ReNew Power announced the commissioning of a 300MW wind power generation facility in the Indian state of Gujarat, which aims to provide clean power to the nearby states of Haryana and Orissa.
The recent deal also comes off the back of credit rating agency Fitch Ratings’ revision of the company’s outlook to positive from stable, affirming the rating on ReNew Power’s outstanding senior secured US dollar notes at “BB-“.
“The outlook revision reflects ReNew's deleveraging potential following its announcement it has raised US$610 million from a primary equity sale as part of its public listing plans. We forecast its net leverage, measured as net debt/EBITDA, to reach around 4.8x over the next 18-24 months,” Fitch Ratings says in its rating action commentary.
Last January, ReNew Power issued a US$450 million 7.1-year 144A/Reg S green bond which also generated strong demand, allowing the issuer to tighten pricing by 25bp.