XPCL launches green debentures in baht, offering maximum interest of 5.55% a year

As the operator of CKPower’s largest commercial hydropower plant, XPCL has received an “A-” level corporate credibility rating with “stable” outlook from Tris Rating, while its debenture credibility level is rated “BBB+”.

Aimed at major and/or institutional investors, XPCL green debentures are divided into three tranches:

• Tranche 1, tenure of 3 years, redeemable in October 2026, with flat interest rate of 5.15% per annum.
• Tranche 2, having a 4-year tenure, redeemable in October 2027, with flat interest rate of 5.30% per annum.
• Tranche 3, having a 5-year tenure, redeemable in October 2028, with flat interest rate of 5.55% per annum.

XPCL’s green debentures fully comply with the Green Bond Principles 2021 and ASEAN Green Bond Standards 2018, and have been audited by DNV, an internationally-accredited registrar and classification society that serves as an independent external reviewer.

The company has announced that the funds raised from the issue of the debentures would be utilised to repay its loans that have floating interest rates to reduce financial risks from fluctuation in interest rates, as well as to reduce its average financial cost.

XPCL also eased investors’ concerns about its operations in Laos PDR, assuring that it would not be affected by the country’s economic downturn. It added that its power production business is one of Laos’ main revenues and supports the country’s goal of becoming the “Battery of Asia”.

With a stringent risk management strategy and adequate cash reserves, and by processing operational cashflow through accounts of commercial banks in Thailand, XPCL is confident that it can pay the interest as well as ensure redemption of the debentures without any difficulty.

The company said that its earnings are in baht and US dollar, while only a small portion of its expenses are in the Laotian kip, cushioning it from any significant impact from the fluctuation of the kip.

The Laotian government has awarded a 31-year concession contract to XPCL to design, construct, develop and operate the Xayaburi Hydroelectric Power Plant on the Mekong River in Xayaburi province. Opened in October 2019, the 1,285-megawatt power plant supplies most of its produced power to the Electricity Generating Authority of Thailand.

XPCL is currently producing hydroelectricity at 7,400 gigawatt per year. The company’s use of renewable energy has helped reduce carbon dioxide emissions by 3.8 million tonnes per year, highlighting its position as a champion of environmental conservation.

XPCL is majorly owned by leading power producers in Thailand, namely CKPower (TRIS Rating: A) with a 42.5% stake; Global Power Synergy Pcl (TRIS Rating: AA+) 25% stake, and Electricity Generating Pcl (TRIS Rating: AA+) with a 12.5% stake.

Last year, XPCL reported revenue of 16.23 billion baht with earnings before interest, taxes, depreciation, and amortisation (EBITDA) of 14.73 billion baht, or 91% of EBITDA margin.

In the first half of 2023, XPCL recorded revenue of 5.211 billion baht with EBITDA of 4.567 billion baht, or 88% of EBITDA margin.

As of June 30, 2023, the company’s debt-to-equity ratio stood at 1.8 times, which is lower than debenture standards of not over 3.0 times.

XPCL green debentures can be reserved with a minimum investment of 100,000 baht and in increments of 100,000 baht per time. For more information, contact any of the following five debenture sellers:

• Bangkok Bank Pcl (except micro branches), tel. 1333 or Bualuang mBanking application.
• Krungthai Bank Pcl, tel. 02-111-1111
• Siam Commercial Bank Pcl, tel. 02-777-6784, and its sales unit InnovestX Securities Company Limited
• Kiatnakin Phatra Securities Pcl, tel. 02-165-5555, and its sales unit Kiatnakin Phatra Bank Pcl
• Krungthai XSpring Securities Company Limited, tel. 0-2695-5000