Government-owned power transmission utility Power Grid Corporation of India (POWERGRID) has received approval from its Board of Directors to raise unsecured, non-convertible, non-cumulative, redeemable, and taxable bonds for ₹22.5 billion (~$270.3 million) through private placement.

The bonds will come with a base issue size of ₹5 billion (~$60 million) and a green shoe option of ₹17.5 billion (~$210.3 million). They are redeemable at par in 10 equal installments, with interest payments yearly.

The proceeds will be used to part finance the company’s CAPEX requirements, to provide inter-corporate loans to its wholly owned subsidiaries and joint ventures, and for general corporate purposes.

This will be done by securitization of cash flows of four operational special purpose vehicles – Power Grid Bhuj Transmission, Power Grid Khetri Transmission System, Power Grid Medinipur Jeerat Transmission System, and Power Grid Varanasi Transmission System, up to March 2034.

POWERGRID is India’s largest electric power transmission utility and operates about 86% of the country’s inter-regional networks.

In March, POWERGRID raised the first tranche of its unsecured, non-convertible, non-cumulative, redeemable, and taxable bonds for ₹9 billion (~$108 million) through private placement.

POWERGRID emerged as the successful bidder for the execution of the inter-state transmission system project to evacuate power from renewable energy zones in Rajasthan for 20 GW, Phase-III Part C1. The Letter of Intent was formally received on September 11, 2023.

The project encompasses several critical components, including establishing a novel 765/400 kV substation and integrating STATCOM technology in Ramgarh. It also involves the construction of a 765 kV double-circuit transmission line and the extension of associated bays at existing substations in Rajasthan.

Earlier, POWERGRID announced that its board had approved an investment proposal of ₹3.31 billion (~$40.4 million) for the transmission system to evacuate 20 GW of power from renewable energy zones in Rajasthan under Phase-III Part-J.