Swan Energy says subsidiary prepays Rs 2,206 crore loan, interest; stock down

Swan Energy Ltd on Monday said its subsidiary Swan LNG Private Limited (SLPL) has prepaid entire loan of Rs 2,206 crore along with interest to the consortium of banks. The stock was down 1.20 per cent at Rs 722.10 on BSE. 

With the prepayment, the Swan Energy subsidiary would save around Rs 250 crore in interest payment, which the company hopes to strengthen balance sheet leading to a possible upgrade and re-rating.

Post prepayment, SEL's debt has fallen to Rs 1,675 crore. The external debt position of the group was Rs 4,128 crore in September 2023, which had been reduced to Rs 3,817 crore in December 2023. To facilitate the pre-payment, SEL has lent Rs.2210 crore to SLPL.

"SEL recently raised Rs 3,000 crore through a Qualified Institutions Placement (QIP). The QIP garnered major interest from qualified institutional investors, including Quant Mutual Fund, SBI Life, LIC, LIC Mutual Fund, Tata Mutual Fund, Infini Mutual Funds, SBI General Insurance, BNP Paribas Mutual Fund, Nomura, Diamond Asia, Bank of India Mutual Fund, ITI Mutual Fund, Goldman Sachs, Future Generali, Anand Rathi, and other domestic and foreign institutions and family offices," Swan Energy said.

The funds raised through the QIP would be strategically deployed towards the modernisation of the recently acquired erstwhile Reliance Naval and Engineering Ltd (RNEL) shipyard at Pipavav. Additionally, a portion of the funds will be allocated for project expansion and debt reduction.

"SEL aims to emerge as a leading private player in the manufacture of defence, commercial, and oil and gas vessels and a key player in ship repairing and a hub for global manufacturing in the Asia Pacific region. The group has strengthened its shipyard restoration efforts, focusing on activities such as dredging, reinstatement of licenses and certifications, implementation of industry-standard safety measures, and upgrading basic utilities, aiming to commence commercial operations by June 2024," it said.