GMR subsidiary cuts borrowing costs through debt refinancing

GMR Kamalanga Energy Limited (GKEL), a step-down subsidiary of GMR Power and Urban Infra Limited, has completed the refinancing of its existing debt of ₹2,700 crore. This strategic move aims to lower borrowing costs and enhance financial stability.

Under the new arrangement, GKEL secured a senior loan facility of ₹2,700 crore, enabling the full repayment of all previous lenders. This refinancing has decreased GKEL's average cost of borrowing from approximately 12.15% per annum to 9.50% per annum, with a potential further reduction to 9.25% per annum upon a credit rating upgrade.

The company anticipates estimated interest cost savings of ₹72-75 crore during the first full year of operations following this refinancing. This step is expected to strengthen profitability and increase shareholder value.