The Indian Renewable Energy Development Agency (IREDA) has invited bids from banks and financial institutions to raise term loans amounting to ¥16 billion(~ $113.3 million) with an additional greenshoe option.

The last date for submitting the bids is October 9, 2024.

IREDA is raising funds to lend towards renewable energy, energy efficiency and conservation projects, and renewable energy-allied services in India.

The loan tenure will be five years, with bullet repayment and floating interest linked to the Tona interest rate, which can be paid semi-annually.

The lowest bidder will be decided using the least cost-based selection criteria, for which the total cost will be calculated using IREDA’s evaluation. If two or more bidders bid the exact cost, the one quoting the slightest margin over the interest rate benchmark would be chosen.

The invitation to bid is open to all banks and financial institutions that have provided foreign currency loans in Japanese Yen to other central public sector enterprises functioning as non-banking financial companies within the last five years.

Bidders must comply with the Financial Action Task Force and the Office of Foreign Assets Control Regulations.

The eligibility criteria apply only to the bidding bank/FI and do not apply to the ultimate lender in the event of downselling.

IREDA will raise the loan unsecured and only on its financial strength.

Bidders must agree to an acceptable limit for total network borrowings. They must also adhere to the minimum capital adequacy ratio and liquidity coverage ratio requirements prescribed by the Reserve Bank of India.

The Clear Market Clause, if any, will apply not more than two months from the drawal of funds and syndication. Further, IREDA reserves its rights to raise funds in any currency through alternate markets/modes, i.e., foreign bonds (including Masala Bonds), loans with different underlying benchmark rates, from multilateral institutions like JICA, KfW, ADB, AFD, and EIB, from offshore markets, and loan bonds or any other mode in the domestic currency/domestic markets in India.

In June 2024, IREDA raised ₹15 billion (~$179.5 million) through bonds, which included a base issue of ₹5 billion (~$59.8 million) and a green shoe option of ₹10 billion (~$119.7 million).

In the financial year 2024, the agency approved loans amounting to ₹373.54 billion (~$4.48 billion) and disbursed ₹250.89 billion (~$3.01 billion).