A Kotak Mahindra Bank arm on Friday (June 23) said it has invested Rs 732 crore in the non-convertible debentures (NCDs) of RattanIndia Power Ltd (RIPL).

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Kotak Strategic Situations India Fund II (KSSF II) and Kotak Private Credit Fund (KPCF), managed by Kotak Investment Advisors Ltd (KIAL), said this is part of the total investment of Rs 1,125 crore by a consortium of lenders.

KSSF II and KPCF invested Rs 582 crore and Rs 150 crore, respectively in RIPL. The power company will utilise the proceeds to refinance its existing debt. The fundraising is uniquely structured to match the expected cash flow generation and reduce overall cost, which is in sync with RIPL's improving financial profile.

Srini Sriniwasan, Managing Director of Kotak Investment Advisors Ltd, said the financing provided by the company’s credit funds to RattanIndia underscores its ability to provide timely structured financing to meet specific needs.

This is the first investment from our new credit funds which have participated across the capital stack for appropriate risk-adjusted returns, Sriniwasan added.

RIPL is a part of the RattanIndia Group, promoted by Rajiv Rattan. It operates a thermal power plant with an operational capacity of 1,350 MW at Amravati in Maharashtra, India. It is one of the few private sector thermal power generators supplying power to Maharashtra State Electricity Distribution Company Ltd (MSECDL).

Eshwar Karra, CEO of Kotak Special Situations Fund at Kotak Investment Advisors, said this investment is in line with the fund's objective of providing solution capital to businesses needing patient funding. It also underscores how KSSF II, through its experience and expertise, has structured a solution that addresses RIPL's financial requirements.

(Edited by : Shoma Bhattacharjee)