Public-Sector Hydropower Firm Eyes Japanese Banks For Debt To Fuel Solar Expansion

Government-owned NHPC is reportedly reaching out to banks in Japan as it seeks cheaper funds to fuel its expansion into solar power.

What Happened? The Indian state-backed hydropower firm is looking to borrow up to ₹5,000 crore in yen-denominated loans from Japanese Banks, finance director Rajendra Prasad Goyal told Bloomberg.

The director said the company in talks with Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group and the Japan Bank for International Cooperation.

See Also: Amazon Pay Banks On Mobile Wallets To Make A Dent In India’s Consumer Payments Sector

NHPC believes it can access cheaper loans through yen-denominated debt instead of borrowing domestically, as it aims to keep financing costs low to compete in India’s solar market, where it is expanding its green energy portfolio with 1.2 gigawatts of solar projects.

Cheaper capital would also keep the firm well-positioned to bid for solar projects in intense bidding auctions.

The hydroelectric company is looking to borrow debt with at least a 10-year tenure to suit its cashflows, Goyal told the business publication. It would be the firm’s first overseas debt in four years.

Price Action: Shares of NHPC were up 0.44% at ₹45.60 around noon on Thursday.

Read Next: Tata Motors Continues Bull Run: Why This Analyst Turned Cautious

Market News and Data brought to you by Benzinga APIs

Don't miss a beat on the share market. Get real-time updates on top stock movers and trading ideas on Benzinga India Telegram channel.

Posted In: EquitiesGovernmentNewsBondsFinancingMarketsJapan Bank for International CooperationMitsubishi UFJ Financial GroupNHPCSumitomo Mitsui Financial Group