Mumbai: Tata Cleantech Capital Ltd (TCCL), a joint venture of Tata Capital Ltd and World Bank arm International Finance Corp. (IFC), has raised Rs200 crore (about $31 million) from its promoters to grow its loan book, a senior company executive said. Tata Cleantech is a non-banking finance company (NBFC) that funds renewable energy projects across assets such as solar, wind, small hydro and biomass, as well as other green businesses such as energy efficiency and water treatment.
TCCL, which received its infrastructure finance company licence from the Reserve Bank of India in October 2015, has funded more than 80 renewable energy projects with a total capacity of 3,500 megwatts (MW). “Both Tata Capital and IFC have additionally invested Rs200 crore as equity capital in proportion to their respective shareholdings in TCCL. With this infusion, the total Tier I capital of TCCL has increased to Rs591 crore,” said Manish Chourasia, chief executive of TCCL in an email response to Mint queries . Tata Capital has an 80.5% holding in Tata Cleantech while IFC has a 19.5% stake.
TCCL will continue to focus on financing environment-friendly projects such as wind, solar, hydro and other climate-related projects, besides selectively funding projects in other infrastructure space, namely, power transmission, water, education, and healthcare, Chourasia added. The new round of capital infusion will help the company fund larger projects. “The additional equity infusion of Rs200 crore by the promoters significantly enhanced TCCL’s underwriting capability as well as ability to participate in large-size projects. TCCL is deeply committed to promote development of renewable energy and climate-related projects and contribute to the reduction in greenhouse gas emissions in India,” he said.
With the latest round of equity infusion, the total capital contribution by promoters stands at Rs500 crore, he added. TCCL’s loan book stood at Rs1,998.85 crore as of 31 March, growing by 63.5% from Rs1,222.52 crore at the end of the previous financial year. The company reported revenue of Rs180.24 crore in 2016-17, compared with Rs104.92 crore in the previous year. Profit stood at Rs45.66 crore in 2016-17, as against a profit of Rs27.47 crore a year ago.
The renewable energy lender is planning to raise debt through issuance of green bonds, Mint reported on 17 May. “There is a proposal for IFC to invest up to $40 million in Tata Cleantech. The investment, as proposed, is to be done by subscribing to secured non-convertible debentures that Tata Cleantech plans to issue, structured as green bonds. The proceeds are meant to finance wind, solar, and other projects related to climate and energy sustainability,” said a spokesperson for IFC.
IFC’s portfolio in Indian wind and solar power exceeds $1 billion and spans 3 GW of solar and wind—8% of the country’s installed renewable energy capacity, the spokesperson added. IFC was one of the earliest international investors in the Indian renewable energy sector. Since 2009, the World Bank arm has invested in various renewable energy producers such as Azure Power, Applied Solar, NSL Renewables and Mahindra Solar. Earlier this year, IFC announced an investment of $125 million in Rahul Munjal-led Hero Future Energies.