GMR Power and Urban Infra Limited has announced the incorporation of a new wholly owned subsidiary focused on solar power development in Odisha. The company disclosed this development to stock exchanges under regulatory compliance requirements.

New Solar Power Subsidiary Formation

GMR Energy Limited, a wholly owned subsidiary of GMR Power and Urban Infra Limited, has incorporated GMR Utkal Solar Power Limited (GUSPL) as its wholly owned subsidiary. The new entity was incorporated on December 29, with the Certificate of Incorporation received on December 30.

Investment Structure and Shareholding

The subsidiary formation involved subscription to 10,000 shares of ₹10.00 each through the Memorandum of Association. GMR Energy Limited currently holds 100% stake in GUSPL, making it an indirect wholly owned subsidiary of GMR Power and Urban Infra Limited.

Project Objectives and Business Focus

GMR Utkal Solar Power Limited has been established specifically for the development of solar power projects in Kamalanga, Odisha. The subsidiary operates in the renewable energy sector, focusing on generation and transmission of solar power infrastructure.

The company clarified that the incorporation does not fall within the purview of related party transactions. The promoter, promoter group, and group companies do not have any direct interest in the entity except for indirect shareholding through the existing corporate structure.

Regulatory Compliance

The disclosure was made pursuant to Regulation 30 of the SEBI Listing Obligations and Disclosure Requirements Regulations, and SEBI Circular. The company confirmed that no specific governmental or regulatory approvals were required for this incorporation, as it was completed through the standard subsidiary formation process.

GMR Power & Urban Infra announced that its step-down subsidiary GMR Kamalanga Energy Limited (GKEL) has successfully completed refinancing of its existing debt worth ₹2,700 crores at substantially reduced borrowing costs. The refinancing represents a strategic financial restructuring aimed at improving operational efficiency and profitability.

Refinancing Details and Cost Reduction

Under the new refinancing arrangement, GKEL has secured a senior loan facility of ₹2,700 crores, enabling complete repayment of all existing lenders. The refinancing has delivered significant cost benefits for the power subsidiary.

*Subject to credit rating upgrade

Financial Impact and Savings

The substantial reduction in borrowing costs is expected to generate significant financial benefits for GKEL. The company has provided specific estimates for the interest cost savings following the refinancing completion.

Strategic Significance

The refinancing marks a pivotal step in GMR Power & Urban Infra's journey toward financial efficiency and sustainable growth. The significant reduction in borrowing costs is positioned to strengthen profitability and enhance shareholder value. The arrangement also includes provisions for further cost optimization, with the borrowing rate potentially decreasing to 9.25% per annum subject to achieving a credit rating upgrade.

Corporate Structure

GMR Kamalanga Energy Limited operates as a step-down subsidiary of GMR Power & Urban Infra, focusing on power generation activities. The successful debt refinancing demonstrates the parent company's commitment to optimizing capital structure across its subsidiary operations and improving overall financial performance.