Board approves ₹117 crore corporate guarantee for solar subsidiary's term loan
Board approved a corporate guarantee of up to ₹117 crore (plus interest, costs) to PNB's security trustee for a term loan to wholly owned subsidiary MCFL Energy Projects, for a proposed 35 MW solar project in Madhya Pradesh.
By ScoutQuest · · 1 min read
- Corporate Guarantee Amount
- ₹117 crore (plus interest, costs, charges and other dues)
- Solar Project Capacity
- 35 MW
- Project Location
- Madhya Pradesh
- Borrower Entity
- MCFL Energy Projects Private Limited (wholly owned subsidiary)
- Lender
- Punjab National Bank (through IDBI Trusteeship Services as Security Trustee)
What was approved
On November 3, 2026, the Board approved furnishing a corporate guarantee in favour of IDBI Trusteeship Services Limited, acting as Security Trustee for Punjab National Bank.
- It secures a term loan of up to ₹117 crore, plus interest, costs, charges and other dues.
- The borrower is MCFL Energy Projects Private Limited, an unlisted wholly owned subsidiary.
- The loan is for the subsidiary's proposed 35 MW solar power project in Madhya Pradesh.
What a corporate guarantee means
If the subsidiary fails to repay the loan, the parent company promises to pay the bank. Until then, no money leaves the company.
Impact as stated by the company
- The guarantee will be treated as a contingent liability (a possible future obligation).
- The company states there is presently no impact on it.
- Promoter/promoter group companies have no interest in the transaction.
- The guarantee is proposed to be issued on terms to be mutually agreed.
Why it matters
It shows the company backing a renewable energy project through its subsidiary, while taking on a potential obligation of up to ₹117 crore plus interest if the subsidiary cannot repay.
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More numbers
- Corporate guarantee / term loan amount₹117 crore
- Solar project capacity35 MW
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