Tata Power Co., an Indian power production company, intends to raise up to $1 billion in cash for sustainable energy projects. This might be the largest local currency loan in the nation this year.

According to persons with knowledge of the situation who asked to remain anonymous since the material is confidential, the Tata Group unit, one of the biggest conglomerates in India, is in discussions for a loan with lenders such as State Bank of India, IndusInd Bank, Axis Bank, and ICICI Bank.

This year, the highest local currency loan in India was a $365 million deal done in February by Assam Bio Refinery Pvt. Tata Power would gain that distinction if its proposed borrowing, which is expected to total close to $1 billion, comes to fruition.

According to those with knowledge of the matter, the loan's revenues will go toward financing the business's $1.6 billion investment, which was revealed in August, to construct pumped hydro storage facilities, which are a type of renewable energy.

By the end of the decade, India wants to almost treble its capacity for green electricity, and companies like Tata electricity, Adani Green Energy Ltd., and Reliance Industries Ltd. are stepping up their efforts in this regard. By 2027, Tata Power wants to have nearly quadrupled its capacity for renewable energy generation.

The agreement might be a pooled facility or a bilateral loan. According to the persons, the firm plans to negotiate credit lines with lenders over the next three to six months. Following that, payments would be made in installments based on the progress of the project. They said that the loan may be priced above regional benchmarks like Treasury bills or the repo rate set by the Reserve Bank of India. The terms of the agreement might alter since negotiations are still underway.

When asked for responses, Tata Power and the aforementioned banks remained silent.