ACME Solar, an Indian developer of solar power projects, has secured a flexible line of credit worth INR 7 billion ($108 million) from Piramal Finance, which is a subsidiary of Indian investment group Piramal Enterprises Ltd.
The loan agreement is based on Piramal’s ‘Flexi Line of Credit’ package, which will allow ACME Solar to draw down the money, and repay a chosen amount, at any time during the loan tenure.
The flexibility offered by such an agreement is attractive to ACME Solar, enabling it to assess its cash requirements based on operational projects and development progress.
ACME Solar currently has more than 1 GW of operational PV projects in India, and expects to reach 1.4 GW by the end of September. Group chairman and MD Manoj Kumar Upadhyay said that the funding provides ACME with the required flexibility to invest in solar and the electric transportation business and to ensure the timely completion of projects.
“Given the growth dynamics of the renewable space in India, we believe renewables would constitute a major portion of India’s installed capacity,” Upadhyay said.
Piramal conducted the deal through its Corporate Finance Group, which has been active in India’s clean energy landscape for a while now, offering capital across the entire risk curve of projects, through infrastructure to direct investment in renewable projects.
“Renewable energy has been one of the key focus areas for our group and Piramal has benefited by being one of the early movers in the sector,” said Piramal Finance MD Khushru Jijina. “Our first round of funding with ACME has already seen pre-payments taking place in a short span of time.”
Piramal Enterprises – along with its Dutch pension fund asset partner APG Asset Management – pledged in 2014 to invest more than $1 billion in India’s infrastructure sector over the coming few years.