In order to refinance its existing debt, Essar Power mopped up Rs 750 crore by issuing rupee denominated bonds.
The company, which is part of the London-listed Essar Energy, has a total debt of around Rs 16,500 cr.
The bond offering would increase the maturity timeframe of its debt and also enable the firm save on interest cost.
The company aims to raise as much as Rs 5,000 cr through the second tranche of its 11-year bond issue. The coupon rate is known to be around 12.5 percent. The company had already raised Rs 629 cr in its first tranche, two months back.
The securities will be repaid between 2022 and 2024 and will be listed on the BSE. However, it is currently intended that this bond issue will be refinanced with a Rs 3,000 cr credit enhanced rupee bond issue in due course.
Meanwhile, in order to reduce operational cost, the firm is in the process of shifting to a completely coal-based power generation from a partial gas-based one.
It is converting two of its gas-based captive power plants Â– Hazira, which is of 515 mw and Bhander of 500 mw Â– into imported coal-fired plants by 2015.