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23 Jul 2021

Climate change bonds

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The disruptive weather patterns across the globe has thrown into focus Climate Change and the urgent need to act by all stakeholders. Heat wave in North America and Canada, floods in Europe and China and uneven rainfall in India are all are attributed to the environmental damage due to unsustainable levels of CO2 released into the atmosphere.

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Arjun Parthasarathy

ESG investing is gaining ground very fast

The disruptive weather patterns across the globe has thrown into focus Climate Change and the urgent need to act by all stakeholders. Heat wave in North America and Canada, floods in Europe and China and uneven rainfall in India are all are attributed to the environmental damage due to unsustainable levels of co2 released into the atmosphere.

ESG (Environmental, Social, Governance) is also becoming a huge investment theme, with USD trillions being poured into ESG investments. ESG bonds are gaining a lot a traction with Green Bonds and other such environment and socially relevant bonds seeing good demand from investors.

ESG in Indian bond market

In India, there is awareness being created on ESG and there have been Green Bonds issued by Indian Companies. Some of the issuers have raised USD denominated bonds in the global market, the latest being JSW Hydro Energy, which is a subsidiary company of JSW Energy. Hero group, RePower are other corporates to issue Green Bonds overseas among other issuers.

Given the importance of ESG, especially climate change, there will be a strong growth in demand for ESG bonds by investors. Many issuers in the clean energy and other socially relevant businesses will start to come out with regular issue of bonds to fund their projects. The government too will play its role in ESG with PSUs coming out with ESG compliant bonds.

Tata Cleantech Bonds

Tata Cleantech funds green energy projects and is a part of the Tata Group, The bonds are well traded in the market and is available for individual investors. Demand is good for Tata Cleantech bonds, as it is one of the very few green bonds that is traded in the market.

INRBonds has a report on Tata Cleantech and has also given its proprietary risk rating of the bond. Access the bond details in INRBonds Marketwatch and check for offers to invest in Green Bonds.

 

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