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JSPL to raise $1 billion through non-convertible, unsecured bonds

JSPL to raise $1 billion through non-convertible, unsecured bonds

01 Sep 2021

Mumbai: The board of Naveen Jindal-led & Power approved a proposal to raise funds of up to $1 billion (Rs 7,347 crore) through non-convertible, senior, unsecured bonds.

“The board… has approved a potential fundraising, including by way of issuance of non-convertible, senior, unsecured, fixed/LIBOR rate notes denominated in foreign currency or rupee bonds, to be issued in one or more tranches,” the company said in a statement.

The company, while announcing its June-quarter results, said that it plans to invest close to Rs 18,000 crore in the next six years on both maintenance and growth Capex. For FY 22, the company has earmarked capex of Rs 2,400 crore.

“The company is yet to explore the market. The utilisation of the funds will be majorly to increase liquidity in the company and some for expansion. However, JSPL’s internal accruals are more than enough for expansions,” said a person close to the development.

The company has a capacity of 8.6 million tonnes per annum (MTPA) and is planning to take the capacities to 15.9 MTPA by FY 24.

This is the first time JSPL is exploring the bond markets; the company always took term loans, said the person quoted above.

JSPL’s consolidated net debt is around Rs 15,227 crore in 1QFY22 as against Rs 22,146 Cr in March 2021. The company has also committed to being a net-debt free company by FY25.

In a move to bring down the debt, the company announced divesting its power business, Jindal Power Ltd, for Rs 7,401 crore to one of its promoter firms, Worldone Private Ltd.

JSPL posted a consolidated net profit of Rs 2,516 crore in the June quarter of FY 22, up 11 times from the year-ago period.