Indian Renewable Energy Development Agency (IREDA) chooses London to launch first Green Masala Bond
- Becomes first green Masala bond on London Stock Exchange’s new International Securities Market (ISM)
- IREDA Chairman and MD, Mr. Kuljit Singh Popli, opens London trading to celebrate the bond launch
- Reinforces London’s status as most international financial centre and India’s partner of choice
London Stock Exchange today welcomes Indian Renewable Energy Development Agency’s (IREDA) first green Masala bond. The five year dated green Masala bond raised approximately $300 million (INR 19.5 billion) with a coupon of 7.125 per cent and becomes the first green Masala bond to be listed on London Stock Exchange’s International Securities Market (ISM). The green bond is certified by Climate Bonds Initiative, an international, investor-focused not-for-profit, which helps build robust and transparent assurance frameworks around green bond investment.
IREDA, a state owned company established as a non-banking financial institution, promotes, develops and extends financial assistance for renewable energy and energy efficiency conservation projects in India. The company provides financing for hydro, wind and solar energy projects, new and emerging technologies, and bio energy sectors. The money raised from its green bond will go towards financing renewable energy projects across the country.
This is the fourth green bond by an Indian issuer to be issued on London Stock Exchange. Axis Bank and NTPC joined in 2016 raising respectively $500 million and $300 million equivalent. In June this year REC raised $450 million. In 2015 London Stock Exchange launched its dedicated green bond segments creating strict admission criteria aligned with ICMA’s Green Bonds Principles. There are 48 green bonds listed in London that have raised over $13 billion in aggregate terms across seven currencies. Ten new green bonds have been listed on London Stock Exchange in 2017 alone.
London Stock Exchange is now the largest Masala bond centre globally with 42 bonds listed in total with an equivalent value of over $6 billion. London Stock Exchange has been firmly committed to developing long-term strategic partnerships with issuers to ensure the success of this financing stream and help Masala bonds evolve from specialist to a mainstream asset class.
Chairman & managing director of IREDA, Kuljit Singh Popli, together with Secretary, Ministry of New and Renewable Energy, Shri Anand Kumar and MP, Minister of State for Universities, Science, Research and Innovation, Jo Johnson, joined Xavier Rolet, CEO of London Stock Exchange Group, to open trading in London this morning.
Xavier Rolet, CEO, London Stock Exchange Group, said:
“The listing of the first green masala bond on our new International Securities Market is a significant milestone that we are honoured to celebrate with Chairman Popli and his team.
“There is an indisputable shift in momentum in green and sustainable financing across the world and London Stock Exchange Group is proud to be spearheading the growing global green and sustainable financing movement, developing innovative products and services in partnership with our customers.”
Mr. Kuljit Singh Popli, Chairman and Managing Director of Indian Renewable Energy Development Agency (IREDA), said:
“Indian Renewable Energy Development Agency (IREDA) is fully committed to helping achieve Indian Government’s vision of 175 GW renewable energy capacity by 2022. The Green Masala Bond is a significant milestone for IREDA in this regard, as we embark on the next phase of renewable and sustainable energy led expansion. This is another step towards our Honourable Prime Minister’s commitment to the Paris agreement on Climate Change. The overwhelming response to the issue is a testament to the confidence of global investors in IREDA and the Indian renewable sector in general.”
Shri Anand Kumar, Secretary, Ministry of New and Renewable Energy, said:
“The IREDA Green Masala bond illustrates Government of India’s commitment towards fostering the renewable and sustainable energy sector. Renewable energy will increasingly become the dominant force in energy generation, as we strive for ‘’Electricity for All” and achieve our mandate of 175 GW renewable energy capacity by 2022. With advancements in technology, and with price of solar and wind reducing, we are not only sure but confident that we will not only achieve the target, but exceed it. I congratulate the IREDA team on successfully executing this marquee transaction.”
Jo Johnson MP, Minister of State for Universities, Science, Research and Innovation, said:
“The London Stock Exchange is the largest, and greenest, in Europe and has helped position Britain as a world-leader in green finance. The Government is committed to building on this success and recently set out measures to draw on the expertise of the City to accelerate the growth of products like green bonds. We are committed to growing our economy while reducing emissions and recognise the huge opportunities presented by the unstoppable move to a low carbon economy.”
London Stock Exchange has a strong track record of supporting green bond issuances by supranational, municipal and private company institutions on its markets. LSEG is home to a number of global first green bond issuances from Bank of China and Agricultural Bank of China, India’s Axis Bank, Development Bank of Japan and the IFC, a member of the World Bank Group.
Further information on the Group’s green financing initiatives can be found online at London Stock Exchange Group’s Global Sustainable Investment Centre: www.lseg.com/sustainable
To find out more about ISM, visit: www.lseg.com/ism
IREDA’s green bond is the latest in a long line of global firsts for London Stock Exchange Group, including numerous high profile Indian and green bond issuances on London Stock Exchange:
- June 2017 - Rural Electrification Corporation’s (REC) launches first ten year dated green bond raising $450 million
- January 2017 – European Bank for Reconstruction & Development issues $62 million masala bond, the first in London and Europe in 2017
- September 2016 - British Columbia issues world’s first Masala bond by a foreign government entity
- August 2016 – NTPC, Indian energy conglomerate becomes first Indian green Masala bond issuer
- July 2016 – HDFC lists world’s first Masala bond by an Indian corporate
- June 2016 – Axis Bank lists India’s first internationally listed certified green bond & its entire $5 billion MTN programme
- June 2016 - first Chinese sovereign RMB bond issued outside of China lists in London, bringing total number of offshore RMB bonds issued in 2016 alone in London to 54, more than all other offshore RMB markets combined
- August 2015 - International Finance Corporation (IFC) issues world’s first offshore green Masala bond, raising $52 million equivalent
- February 2014 – IFC lists first Rupee denominated bond, going on to issue a further 3 Masala bonds in London over 2 years
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For further information:
Alex Ritterman +44 (0)20 7797 1222