ICRA rates Sunborne Energy Gujarat One's bank loans at BB/"stable"A4

Sep 19, 2011 - ICRA on Monday assigned BB/"stable"/A4 ratings to the bank facilities of Sunborne Energy Gujarat One Private Limited (SEGOPL), a special purpose vehicle created under Sunborne Group to build and run a 15-MW solar plant in Kutch, Gujarat, which is scheduled for completion by December 2011.

ICRA said the ratings took into account the technical risks stemming from the limited track record in India of utility solar projects and noted that the December 2011 deadline seemed aggressive.

The agency also said that as solar power was currently uncompetitive compared to conventional power sources in terms of costs, off-takers' ability and readiness to pay such tariffs would continue to be a major rating driver.

SEGOPL had agreed relatively high feed-in tariff, in line with the policy of the Gujarat government, ICRA said, but cited as a risk the fact that the take-or-pay clause in its Power Purchase Agreement was relatively weak.

The positive factors behind the ratings include backing from international private equity funds, the selection of internationally proven technology and the announcement of adequate feed-in tariffs by the Gujarat government.

Rating agency website: www.icra.in

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