Q2 2024 ReNew Energy Global PLC Earnings Call
Speaker 1: Thank you for standing by and welcome to the Renew Second Quarter Fiscal Year 24 Earnings Report.
Thank you for standing by and welcome to the renewable second quarter fiscal year 'twenty four earnings report.
Speaker 1: All participants are in listen-only mode. There will be a presentation, followed by a question and answer session.
All participants are in listen only mode. There will be a presentation followed by a question and answer session.
Speaker 1: If you wish to ask a question, you will need to press the star key followed by the number one on your screen.
If you wish to ask a question you will need to press the star key followed by the number one on your telephone keypad.
Speaker 1: I would now like to hand the conference over to Nathan Judge of Investor Relations.
I would now like to hand, the conference over to Nathan Judge of Investor Relations. Please go ahead.
Yes, Thank you, Jason and good morning, everyone and thank you for joining US. This morning, we issued a press release announcing results for the fiscal 2024 second quarter ending September 32023.
Speaker 2: Yeah, thank you, Jason, and good morning, everyone, and thank you for joining us. This morning, we issued a press release announcing results for the fiscal 2024 second quarter ending September 30, 2023. A copy of the press release and the presentation are available in the investor relations section on Renew's website at www.renew.com.
A copy of the press release and the presentation are available on the Investor Relations section of Army News website at Www Dot renewed dot com.
Speaker 2: With me today are Suman Sinha, Founder, Chairman and CEO , Paralesh Freshwani, our newly appointed CFO , and Vashali Nigam Sinha, Co-Founder and Chairperson of Sustainability. After the prepared remarks, we will
With me today are <unk>, founder Chairman and CEO, Pat last fresh Suwannee, our newly appointed CFO and.
And the Sally Nag them send her co founder and chairperson of sustainability.
After the prepared remarks, we will open up the call for questions. Please note our safe Harbor statements are contained within our press release presentation materials and materials available on our website.
Speaker 2: Please note, our safe harbor statements are contained within our press release, presentation materials, and materials available on our website.
Speaker 2: These statements are important and integral to all remarks, and there are risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward
These statements are important and integral to our remarks, and there are risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward looking statements. So we encourage you to review the press release, we furnished in our form 6K, and the presentation on our website for a more complete descript.
Speaker 2: So we encourage you to review the press release refurnished in our Form 6K and the presentation on our website for a more complete description.
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Speaker 2: Also contained in our press release, presentation materials, and annual report are certain non-IFRS measures that we reconcile to the most comparable IFRS measures, and these reconciliations are also available on our website in the press release, presentation materials, and our annual report. And it's now my pleasure to hand it over to
Also contained in our press release, the presentation materials and annual report on certain non Ifr S measures that we reconciled to the most comparable.
F. R. S measures and these reconciliations are also available on our website and the press release presentation materials and our annual report.
And it's now my pleasure to hand, it over to some of the month.
Speaker 3: Yeah. Thank you, Nathan. Good morning, everyone. I'm glad to have you all in our second quarter of fiscal year, end of 2024. On next call.
Yeah. Thank you Nathan good morning, everyone.
I'm glad to have you all in the second quarter and fiscal year ended.
Unexplored.
Speaker 3: This year has presented new opportunities for us in avenues that align seamlessly with our competitive advantages.
Does he have presented new opportunities for us in avenues that the 19, asking you about competitive advantages.
Speaker 3: The backdrop for Indian renewable energy developers is the best we have ever seen, marked by a significant surge in power demand, shortfalls in energy supply, significant increase in auctions for renewable energy, which is the lowest cost electricity supply without subsidies.
The backdrop for Indian renewable energy developers is the best we have seen and let's see marked by a significant surge in pharma demand shortfalls in energy supply.
It's a good increase in auctions for renewable energy, which is the lowest cost of electricity supply without subsidy.
Speaker 3: is softening of solar module prices and a shift towards complex projects that is best served by wind, of which we are the largest developer in the country.
If softening of solar module pricing and mix.
Shift towards complex projects that is best served by many.
Of which we have the largest developer in the country.
Speaker 3: I firmly believe that Renew, with its disciplined approach to identifying the best return opportunities, is well positioned to capitalize on the current market.
I firmly believe that with you, but it's a disciplined approach to identify the best opportunities is better positioned to capitalize on the current market.
We continue to make progress towards our goals maintaining capital discipline along the way.
Speaker 3: We continue to make progress towards our goals, maintaining capital discipline along the way.
Speaker 3: We are more confident of achieving our financial guidance set earlier this year and are rating the lower end of our EBITDA guidance by approximately 3%.
We are more confident of achieving our financial guidance that they will be up this year and how you think the long end.
No guidance by approximately 3%.
Speaker 3: We now anticipate delivering between INR 62 billion to INR 66 billion in adjusted EBITDA for FY 24.
We now anticipate delivering between INR 62 billion.
66 billion and adjusted EBITDA for FY 'twenty four.
Speaker 3: We have put in a majority of our wind turbines and solar panels in our largest projects being commissioned this year, which puts us in good stead to deliver on our guidance of between 1.75 and 2.25 gigawatts of projects to be completed by this fiscal year-end.
We have put the majority of our data mining and solar panels in a lot of the subjects. The commission this year.
This puts us in good stead to deliver on our guidance of between $1 75, and coupon two five gigawatts of projects will be completed by.
This fiscal year.
Speaker 3: We expect the additional capacity should translate to approximately 35% or more per share EBITDA growth next fiscal year.
We expect the additional capacity should translate to approximately 35% or more bloodshed EBITDA grew up next fiscal year.
Speaker 3: We continue to see consistent flow of auctions as central agencies such as NPPC, SJVM, SECI, NHPC, and some states have announced RE auctions of 65 gigawatts this year.
We continued to see consistent view on auction.
Central agencies, such as M. P. P C H E N E R M.
H D C and some states have announced RB auctions off 65 Gigawatts this year.
Speaker 3: the highest that we have ever seen in the history of our industry.
The highest that we've ever seen.
Do you have on industry.
Speaker 3: Notably, 18 gigawatts of auctions have already been completed this year, already surpassing the previous year's amount, with still about four months plus to go.
Not to be 18, gigawatts of auctions have already been completed this year already surpassing the previous year's amount.
It's still about four months plus to go.
Speaker 3: A higher ratio of complex auctions signals a trend that distribution companies want specific electricity supply profiles which require customized solutions.
A higher ratio of complex auction signals a chain that distributions cookies once specific electric supply profile, which require customized solutions.
Speaker 3: The complexity and limited development capabilities in India, among other things, have resulted in less participation by comparator.
The complexity and limited development capabilities in India, Oh, My God. The teeth have resulted in less participation by competitors.
Speaker 3: Broadly, we have seen an upward lift to auction tariffs for the past 12 months, and recent auctions indicate that this trend will continue further.
Globally, we have seen an upward lift through auction Paris on the past 12 months.
And Houston to auctions indicate that this trend will continue further.
Speaker 3: We have signed a Power Purchase Agreement, PPA, with GUVNL, which is the Gujarat distribution entity, for 400 megawatts of capacity that we won earlier this year. And I've received letters of awards for another 2.9 gigawatts that we have won.
We have signed a power purchase agreement PPA.
Julien and then which is a good job distribution and compete.
For 400 megawatts of capacity.
Earlier this year.
We see that kind of awards for another 2.9, Gigawatts that we have done.
Speaker 3: As a reminder, we do not include projects with LOAs into our portfolio until we have a contract, a signed PPA, which indicates another step up in our long-term earnings potential as the 3.1 gigawatts of projects, one, receive PPAs over the next three to six months.
As a reminder, we.
Do not include projects with Emily into our portfolio until we have a contract.
Five P P, which indicates another step up in our long term potential as a key 131 gigawatts of projects won the C. P. P is or what the next two to six months.
Speaker 3: Our assets continue to attract interest from investors and strategic partners at favorable valuations.
Our assets continue to attract interest from investors and strategic partners at favorable valuations.
Speaker 3: Recently, we concluded the sale of 100 megawatts of solar assets, resulting in a gain. In a little over two years, we have raised about $565 million from asset recycling and year-to-date about $93 million.
Recently, we concluded the sale of 100 megawatts of solar that's it resulting in a gain.
In a little over two years, we have leased about $565 million from asset recycling and year to date about 93 million.
Speaker 3: The ability to recycle capital and deploy it in higher return opportunities remains a significant component of our capital allocation and value creation strategy.
The ability to recycle capital and deploy it in higher return opportunities remains a significant component of our capital allocation and value creation strategy.
This quarter, we reported net profit after tax of U S. Dollar 45 million was the highest reported by us till date.
Speaker 3: This quarter, we reported a profit after tax of US $45 million, one of the highest reported by us till date.
Speaker 3: This quarter, for the first time in a while, the wind resource was about close to normal.
This quarter for the first time in a while the wind resource was about close to normal.
Speaker 3: Will PLS increase to 41.3% from approximately 33.7% in the corresponding quarter last year?
<unk> increased to 41, 3% from approximately 33, 7% in the corresponding quarter last year.
Speaker 3: and marks three straight years where we have seen improved wind resource, which may portend for more normal weather going forward.
And last please stay tuned straight years that he has seen improved wind resource.
Which may portend for more normal weather going forward.
Speaker 3: While we remain optimistic about long-term wind PLS returning to normal levels.
While we remain optimistic about long term link DNS returning to normal levels.
Speaker 3: We are choosing to remain conservative at this time about our weather expectations for the remainder of this year in our guidance.
We are choosing to remain conservative at this time about a better expectation for the remainder of this year in our guidance.
Turning to page five.
Speaker 3: In September 2023, we witnessed a record surge in power demand, taking 240 gigawatts during peak hours, as well as a surge of power prices traded on the exchange.
In September 2023.
You'll recall so it didn't bother demand.
It is 240 gigawatt during peak alloys.
As well as Australia power prices traded on the exchange.
Speaker 3: reflecting strong overall growth in power demand in the country.
Reflecting strong overall growth in power demand in the country.
Speaker 3: We have seen overall power demand consistently rise at 8% over the last several years.
We have seen the overall travel demand consistently rising 8% over the last several years.
Speaker 3: and continue to expect sustained growth for the next few years.
I'm confused expect sustained growth for the next few years.
Speaker 3: While the Indian government is ambitious about achieving the 2030 Renewable Energy Targets with a 50 gigawatt renewable energy annual auction calendar.
While the Indian government has ambitious about achieving the 2030 renewable energy targets.
Is it 50 gigawatts of renewable energy and one auction calendar.
Speaker 3: Our position as a market leader in developing wind remains differentiated.
Our position as a market leader in developing women remain differentiated.
With the shift away from when they log in and sort of the auction there is a tilt towards around the clock and complex auction.
Speaker 3: With a shift away from vanilla wind and solar options, there is a tilt towards round-the-clock and complex options.
Speaker 3: a significant step towards catering to unique power demand profile of distribution companies with VIN as a key differentiator.
A significant step towards at least a unique public demand provide all distribution companies with Vale.
As a key differentiator.
Speaker 3: Our experience in developing complex solutions provides us with significant advantage over others who do not yet have in-house wind EPC capability, digital or AI platforms, and strong understanding.
Our experience in developing complex solutions.
<unk> made significant advantage, all others, who do not yet have it in house, we EPC capability.
Did you drill all AI platform.
And strong understanding of the supply chain cycle.
Speaker 3: that enable us in securing returns superior to our peer group.
That enabled us in securing returns superior to our peer group.
Turning to page six.
Speaker 3: While the market opportunity is substantial, our commitment to capital discipline remains unwavering.
While the market opportunity is substantial.
Our commitment to capital discipline remains unwavering.
Speaker 3: In-house wind and digital capabilities empower us to seamlessly build, operate, and maintain renewable energy projects, providing us competitive advantages in the market and enabling returns above our competitors and above our cost of capital.
In house Wyndham digital capabilities empower us to seamlessly build all three are maintained renewable energy projects.
Providing us competitive advantages in the market and enabling began above our competitors.
And above our cost of capital.
Recently, we signed a P. P M Julian and I, just got off a coupon of seven one bucket of water for 400 megawatts of sawmill.
Speaker 3: And recently, we signed a PPA with UNL at a tariff of 2.71 per kilowatt hour for 400 megawatts of solar, and letters of awards, secure letters of awards for most of our 3.1 gigawatts of auctions went earlier this year at an attractive tariff.
That doesn't awards secured letters of award for most about keep on one gigawatts of auction wins earlier this year unattractive status.
Speaker 3: Given the increase of intermittent generation in the country, there is substantial demand for electricity supply that meets more stringent delivery and reliability requirements.
Given the if you want me to make any invasion of the country. There is substantial demand for electricity supply that needs more stringent reliability requirements.
Speaker 3: More than 60% of the 37.2 gigawatts of auctions yet to be completed this year are complex power solutions.
More than 60% of the 20 712 Gigawatts of Washington, yet to be completed this year I complex bottler solutions.
Speaker 3: Given our industry-leading wind EPC capability, our scale, given the larger size required for complex projects, our ability to source equipment through vertical integration, our superior access to the lowest cost of capital, and our substantial land bank, we have competitive advantages in delivering these complex RE projects quicker and at a lower cost than anyone else in India.
Given our industry, leading D. P C capability, asking given the larger size and quite a complex topic.
Our ability to source equipment to vertical integration.
Our superior access to the lowest cost of capital.
And our substantial land bank you have competitive advantages in delivering these complex ami projects quicker.
Lower cost than anyone else in India.
Speaker 3: To summarize, this is therefore one of the best backdrops for Indian renewable energy that we have seen in a very, very long time.
To summarize this is therefore, one of the best backdrops, while Indian he leave an energy density.
We've seen a very very long life.
Turning to page seven.
Speaker 3: Our on-ground progress remains on track as our projects enter the final construction phase.
Our ongoing progress remains on track.
And the final construction phases.
Speaker 3: Cheaper solar module prices have enabled us to procure modules at almost half the price as compared to the same time last year.
She plus solar module pricing has enabled us to procure modules like almost half the price as compared to the same time last year.
Speaker 3: We delayed projects in the past because of then CAPEX costs would have resulted in subpar IRR.
These delayed projects in the past because of Dent capex costs would have resulted a softball I alive.
Speaker 3: As we continue to reiterate, we remain laser focused on capital discipline and have been rewarded by our patients.
As we continue to reiterate.
Really laser focus on capital discipline and have been rewarded by our patients.
Speaker 3: We have saved shareholders, by our estimate, about $100 million in lower CapEx by pushing out certain problems.
We have seen Chad Williams by an estimate of about $100 million of lower capex by pushing out certain topics.
Speaker 3: We have consistently invested small amounts of capital in complementary businesses to enable even greater competitive advantages of our core renewable energy development business.
We have consistently invested small amounts of capital and complementary businesses to enable even greater competitive advantages of our called renewable energy development business.
Speaker 3: For example, we spent about 10% of our CAPEX to develop solar manufacturing given the substantial reductions on imports that are being imposed by the central government.
For example.
We spent about 10% of our capex to develop solar manufacturing given the substantial reductions on imports that are being enforced by the central government.
Speaker 3: This decision has borne fruit in allowing us to procure high IRR projects in recent auctions that others may not have been able to procure supply for.
This decision has borne fruit in allowing us to procure high IRR project in recent auctions that others may not have been able to secure supply for.
Investment in transmission is another example.
Speaker 3: There are currently chronic delays across India in completing interconnection hubs that allow new projects to connect to the grid.
That all kind of acute chronic delays across India in completing interconnection hubs, that's allowing you to connect to the grid.
Speaker 3: Rather than leave our large project sitting idle, we decided to invest a small amount of capital, less than 5% of our equity, to build a transmission ETC business.
Rather than leave a large public sitting idle.
Starting to invest a small amount of capital.
Less than 5%.
He built a transmission EPC business.
Speaker 3: Furthermore, we have recaptured most of this equity through capital recycling that has garnered gains.
Furthermore, we have recaptured most of this equity through capital recycling that hadn't gone live games.
Speaker 3: We successfully commissioned our first transmission project this quarter, which is the connection point for our large peak power project, providing 138 circuit kilometers of connectivity.
We successfully commissioned our first transmission projects this quarter.
Which is the connection point for a large power project, providing a hunter did sucking kilometers of Collectability.
Before I turn it over to our newly appointed CFO.
I'm really pleased that the board has chosen to promote their lives to the CFO rune.
Speaker 3: Many of you would have interacted with Kailash previously and know of his experience and extensive knowledge of renewable energy debt market.
Many of you would have interacted with your life's previously and off his experience and extensive knowledge of renewable energy market.
Speaker 3: Kailash has been with Renew since the beginning, having joined us in 2011 as one of the founding members of the company and has been instrumental in all of our fundraising efforts, both debt and equity.
The launch has been with us since the beginning and he joined US in 2011 as one of the founding members of the company and has been instrumental in all of our fund raising efforts.
Both debt and equity.
Speaker 3: With this, he has helped renew rates close to $15 billion through various sources, including about $565 million raised through acid recycling.
So did he has had to deal with the east coast with $15 billion to various sources.
About $565 million raised through asset recycling.
Speaker 3: I do consider us lucky that we were able to identify someone internally for this position who has in-depth knowledge about the business as well as a proven traffic.
I do consider lucky that people are able to identify somebody internally for disposition, who has in depth knowledge about the business.
That has a proven track record.
With that I would like to turn it over to Ken to go over the latest financials.
Speaker 3: With that, I would like to turn it over to Kailash to go over the latest financial.
[noise] tanker demand and it's my pleasure to be here and interact with all of you.
Speaker 4: Thank you Sumanth and it's my pleasure to be here and interact with all of you. Before I begin my comments on the quarter, I thought I would like to share a little about my view on my commitment to Capital Discipline, in which I am a staunch believer.
Before I begin my comments on the quarter I called it I would like to share a little about my view on my commitment to capital discipline, and which I'm a strong believer.
Speaker 4: We live within our means and only deploy capital when the returns on our investments are comfortably above our cost of capital.
We live within our means and only deploy capital into their guns Arnott and regimens are comfortably above our cost of capital having been on the news enrichment comedy for some time I believe the board of the $2 million share buyback macro dark horizon.
Speaker 4: Having been on Renews Investment Committee for some time, I fully supported the $250 million share buyback that was authorized in February of last year, as I saw investing in our shares as one of the most attractive investment opportunities of scale at that time.
February of last year as I call it investing in ourselves as one of the most attractive investment opportunities all school at that time.
I still believe that at the current share price that I don't write out help options that we can use to fund growth without issuing shares.
Speaker 4: I still believe that at the current share price, there are a wide array of options that we can use to fund growth without issuing shares. I have led all of the capital recycling efforts so far and see a significant amount of demand for our project.
I have like all of the capital recycling effort, so far and see a significant amount of demand for that project.
Speaker 4: I also will lead efforts to deleverage our balance sheet over time.
I also believe efforts to deleverage our balance sheet over time.
Speaker 4: With regard to the veracity of our reported numbers, I fully stand behind it.
I could have it I could do a final report that number I fully stand behind them.
Speaker 4: Turning to page 9, all the global markets have been impacted by rise in interest rates.
Turning to page nine while the global market.
I've been impacted by rising interest rates.
Speaker 4: We have actively managed our portfolio by refinancing a higher cost debt and ensuring our overall cost of debt is kept within check.
We have actively managed our portfolio by refinancing higher cost goods and ensuring our overall cost of debt is kept in check.
Speaker 4: In India, the yield spread for Indian RE debt has compressed significantly as the sector matures.
In India, the Easter holiday.
How did it has compressed significantly Oscar government chart, we concurrently.
Speaker 4: We can currently raise debt for our projects at sub-9% through large Indian financial institutions.
Therefore that project like sub 9% two large Indian financial institution.
Speaker 4: Importantly, assuming interest rates remain where they are now, we expect to be able to refinance debt maturing of 850 million.
Importantly, assuming interest rates remain where they are now we expect to be able to refinance debt maturing over 50 million over the next several years at a lower interest rate saving an average of 25 to 50 basis points.
Speaker 4: over the next several years at a lower interest rate, saving an average of 25 to 50 basis.
Speaker 4: We have significant access to debt from diversified sources, including from PSC and REC, which is the Power Finance Corporation and the Rural Electrification Corporation.
We have significant access to debt from diversified sources, including from B C and D C, which is the bar for NASS Corporation under rule of crickets incorporation.
Speaker 4: which are known to provide one of the most competitive cost of project death in the industry.
It's a known to provide one of the most competitive gotcha gotcha.
I agree.
Speaker 4: We recently signed an MOU of $8 billion with
We recently signed an Mou of $8 billion with them.
Speaker 4: We continue to expect that we will be able to effectively manage our interest costs and ensure that project IRRs remain within the targeted range.
We continue to expect that we will be able to effectively manage our interest cost.
And for the project.
[noise] remain within the targeted range.
Speaker 4: Turning to page 10, our asset recycling program continues to see interest from international players seeking an offset to the carbon footprint.
Turning to booster our asset recycling program.
Lucas who interest from international player, who can offset their carbon footprint.
Speaker 4: We believe that asset recycling will effectively provide us with a long-term advantage by helping us scale at faster pace as well as provides us avenues to optimize the build process and enhance returns on invested capital.
We believe that I said recycling will effectively provide us with a long term advantage by helping our school.
Locker base as well as provides us having used to optimize the base Parker and enhancer gun.
Uninvested capital.
Speaker 4: We completed a sale of 100 megawatt of solar assets in the current period and raised almost US$93 million through asset recycling year-to-date, about $565 million in aggregate.
We completed the sale of 100 megawatt of solar assets in the current period angry are mostly U S dollar $93 million carotid recycling yeah could be.
$65 million in aggregate.
Speaker 4: For growth beyond the current pipeline, we expect that we have operational development capability.
For growth beyond the current pipeline, we expect that rehab operational development capability.
Speaker 4: to be able to build about 2.5 to 3 gigawatts of assets annually, of which we intend to recycle assets including sale or farm downs of net interest of about 1 to 1.5 gigawatts each year.
To be able to build about two and a half the critical work of households annually offering we intend to recycle assets, including our farm down all Snuggled drifts up about one to one heartbeat I work each year.
Speaker 4: which should generate the required cash flow to fund growth in addition to our internal...
Richardson read the required cash flow to fund growth. In addition to writing garner sources.
Speaker 4: This would ensure we have sufficient equity for growth without having to issue shares.
Richard I'm sure all of you have fun.
Liquidity for growth without having to issue shares.
Turning to page 11.
Speaker 4: We are pleased to report a highest quarterly profit after tax of US$45 million and a highest first half year profit after tax of US$81 million.
We're pleased to report the highest quarterly profit off the back Okay. We've got a $45 million and the highest first half profit after tax of your let's call it $81 million go deep.
Speaker 4: We saw a return to normal wind patterns during the current
Saw a return to normal wind patterns during the garden be weird.
Speaker 4: and the wind PLF during the quarter was 41.3% compared to 32.7% in the same quarter last
There wouldn't be alive during the quarter were 41, 3% compared with 32, 7% in the same quarter Nokia.
Speaker 4: And we continue to remain cautiously optimistic about recovery in the long-term wind PLF towards the long-term normalization.
And we continue to remain cautiously optimistic about recovery and the long term will be live towards the long term normal level.
Speaker 4: Our operating capacity increased by approximately 600 MW over the last comparable quarter in the prior year, an increase of about 8%.
Our operating capacity increased by approximately 600, Mega ward or the last comparable quarter in the prior year and in theater for about 8%.
Speaker 4: For the full year, we expect interest costs to be marginally higher to the prior year on account of new projects coming in.
For the full year, we expect interest costs to be marginally higher to the prior year on account of your project commissioning.
Speaker 4: And the same is offset by savings and interest rates from refinancing.
And the same as Al said, my feelings and interest rate comedies and on track.
But this is subject to volatility in the foreign exchange market.
Speaker 4: Taxes look to be about 20-25% higher in FY24 as more of our subsidiaries are turning profit.
That's it looks to be about 20% to 25% higher in the first 24 hours.
All of our countries aren't earning profitable.
Turning to post close we reported in a definitely bring down okay, let's go to $206 million for quarter, two FY 'twenty four.
Speaker 4: Turning to page 12, we reported an adjusted EBITDA of US $256 million for Q2 FY24.
Speaker 4: The higher EBITDA is primarily attributable to additional revenue from projects coming
The higher EBITDA is primarily attributable to additional revenue from projects commissioned during the period higher wouldn't be alert all set by lower late payment charges of about 11 million.
Speaker 4: During the period, higher wind PLFs offset by lower late payment surcharges of about $11 million, as more of our customers are paying on time, and higher operating costs reflecting more headcount to support our goals.
Laura.
Customers are paying on time and higher operating costs, reflecting more head count to support our growth.
Speaker 4: Turning to page 13, our DSO continues to improve year on year, and we have seen an improvement of 119 days since September 22, an improvement of 26 days since the beginning of this fiscal year.
Turning to page 13 idea, who continues to improve year on year and we have seen an improvement of 19 days since September 22, an improvement of 26 days since the beginning of this fiscal year.
Speaker 4: We continue to work with states and continue to believe that our DSO will...
We continue to work with food and continue to believe that that'd be a syringe.
Speaker 4: continue to improve over time as we continue to focus on getting paid for overdue receivables as well as a favourable...
To improve overtime as we continue to focus on getting paid for order to sabre.
Well as a favorable mix shift where more of more of our revenues come from central government and corporate customers will be on time.
Speaker 4: shift where more and more of our revenues come from central government and corporate customers who pay on time.
Speaker 4: Moving to page 14, we are focused on improving our liquidity and...
Moving to page 14, we are focused on improving our liquidity and leverage.
Speaker 4: Our cash balance stood at close to a billion dollars, almost US dollar 985 million.
Our cash balance stood at close to a billion dollars almost theoretical at 95 million and our net debt on operating Archerd, whereas yours colorful one 7 billion off guard.
Speaker 4: and our net debt on operating assets was US dollar 4.7
Speaker 4: of gross debt about 59% of our debt as a fixed
Two 9% of our debt has a fixed interest rate.
Speaker 4: We only have about $325 million of debt maturing.
We only have about $25 million of debt maturing in the next 12 months, which we expect to refinance at an average liquidity than what we're currently paying.
Speaker 4: in the next 12 months, which we expect to refinance at an average lower rate than what we are.
Speaker 4: We have good visibility on how we anticipate refinancing the remaining 600 odd million that matures in FY25 and FY26.
We have good visibility on how we anticipate refinancing the remaining two odd million that matures in FY 'twenty five 'twenty six.
Speaker 4: With that, I would like to turn it over to Vishali to talk about our ESG.
With that I would like to turn it over to Charlie to talk or whatever to talk about our ESG initiatives.
Speaker 5: Thank you, Kailash. Turning to page 16, building upon the momentum from the previous year, we remain steadfast in our commitment to establish new benchmarks across all aspects of our ESG vision, performance, and transparency. We are leading the way for
Thank you Carlos.
Turning to page 16 building upon the momentum from the previous year, we remain steadfast in our commitment to establish new benchmark across all aspects of our ESG lesion asami.
Pardon me and planned studies.
Yeah, leading the D E F G and I'm thankful.
When you leave it sustainability report for fiscal year 'twenty two P. M D. G I think driving decarbonization.
Speaker 5: Renewal released a sustainability report for fiscal year 2022-23 titled Driving Decarbonization.
Speaker 5: The report is aligned with GRI, FASC, and PCFD and externally assured by DNB.
Newport is aligned with G I right.
E N P C M D.
And candidly as shown by Dnb.
One of the key highlights for Todd.
Speaker 5: Some of the key highlights of the report are renew has generated clean electricity, which is 17,386 gigawatt hours, which is enough to power nearly 5 million Indian households.
When you have generated clean electricity.
Which is 17000 300 million EPC gave her work odd which is enough to fall below <unk> 5 million in Hollywood.
Speaker 5: This has also helped to avoid 14 million tons of carbon emissions through its operation, which is about 0.5% of India's total emissions.
It also has to have wide 14 million tons of carbon emissions.
Population, which is about 45% of India's total admission.
Speaker 5: The carbon intensity of the new electricity generation is about 92% less than the Indian power sectors have done.
The carbon intensity of their use of electricity generation is about 92% less than the Indian although Texas average.
Speaker 5: Renew saved about 318,708 kilometers of water, about 48% year-on-year increase through our robotic cleaning and condition-based monitoring system.
When you see about 218708 kilometer.
Walk about.
About.
48%.
Who are the Baltic cleaning and condition based monitoring system.
When you achieve carbon neutral for the 12th consecutive year.
Speaker 5: when you achieve carbon neutral status for the third consecutive year for a scope one and two greenhouse gas emissions.
Couponing to greenhouse gas emissions.
Speaker 5: As mentioned earlier as well, the new net zero targets for 2014 were validated by SBTI and entails reducing greenhouse gas emissions across all scopes by 29.4 percent.
As mentioned earlier today, when you see their targets for 2014, well validated my SVP I I mean, introducing greenhouse gas emissions across all scopes my 29th like Papa.
Speaker 5: by 2027 and by 90% by 2040. Two, clean energy procurement for operation, electrification of fossil fuel-based equipment, encouraging suppliers to set SDPI-aligned targets.
P. P 27, and by 90% I think D E. Shaw Kadena used to kill me full operation electrification of Fox is here with me in Calgary supplier S. E T I align telling me no.
Speaker 5: low carbon footprint raw materials, and green logistics for transportation.
Low carbon footprint, so all materials and green logistics what classification.
Why you can tell we are deeply committed.
Speaker 5: Social responsibility continues to remain an integral part of our business. Our CFR journey, which began in 2014 and since then, we have impacted the lives of over 1 million people across 500 plus villages in India, spanning across 10 states in the remotest parts of our country.
Well sure responsibility continues to remain an integral part of business.
Yes, our journey, which began in 2014 and since then we have in fact in the lives of over 1 million people across 500, plus villages in India spanning our full turnkey remote as possible by country.
Speaker 5: Now, if you could turn to page 17, I would like to switch to specifics of some of our efforts for first half of fiscal year 2024.
Now, let's turn to page 17, I'd like to sneak two specific some of I O plus.
Well, let's talk about fiscal year 'twenty.
Speaker 5: Lighting Light, which is one of our flagship programs, is an initiative where we electrify schools with less than three hours of electricity using solar off-grid. Electrification of 50 schools, and we have also established 50 digital learning centers, and all of this is in progress.
Nike life, which is one of our flagship program is an initiative that will be electrified soon should lessen triage with electricity using solar Ralph great electrification of 50 schools and we have also established 15 did you.
The learning centers.
All of this is in progress.
Speaker 5: and going well. Climate curriculum, we are in the process of rolling out a climate curriculum to about 9,000 students across the country.
And going well.
Curriculum, yeah in the process of rolling out the upside because they came to about 9000 students.
N T.
Speaker 5: Women for Climate is another program we are very passionate about. It is our effort to include more and more women in the energy sector. And we have programs on re-skilling in partnership with UN organizations. And we are also working on re-skilling some of the salt pan workers in Gujarat to becoming now a solar technician.
Women's apparel makers and I bet, you that they are very passionate about it.
But getting more and more women in D C.
And we have programs.
Killing in partnership.
Organization and he has also been working on Reskilling some of their thoughts and daughters and good job to becoming now Oh.
Sure.
Speaker 5: Nearly 60 women part-time farmers have been trained and have secured employment. About 48 trainees have secured employment.
Nearly 60 women for San Pablo had been paid and have secured.
Alignment about four P H Jamie.
We have secured.
Yeah employment employee engagement is an important part of what we do we have for Ramsey VI.
Speaker 5: Employee engagement is an important part of what we do. We have programs designed for and led by employees at Renew.
And led by employees.
Speaker 5: our annual volunteering campaign which is the rice bucket challenge for about 40,000 kgs of rice distributed in India.
Can you angle volume Kidding campaign, which is the lifeblood challenge for about 40000 pages of REIT distributed and yeah, you have to keep talking but you said you have 24 disclosure cycle are we bid submission of CDP climate change 2022 disclosure.
Speaker 5: We have kick-started the fiscal year 24 disclosure cycle with the submission of CBP Climate Change 2023 Disclosure. We will be disclosing further progress in our forthcoming Sustainability A4.
Closing for the progress in our work coming sustainability Paul.
Speaker 5: With this, let me hand it back to Siman to talk about our annual guidance.
This let me hand, it back just a month to talk about guidance.
Speaker 3: Thank you, Vishali. Turning to our annual guidance, I am happy to report that we have increased the bottom end of our FY24 adjusted EBITDA guidance by INR 2 billion to INR 62 billion to INR 66 billion on account of a better than expected H1 performance.
Thank you Michelle.
Turning to Anvil.
And with guidance I'm happy to report that we have increased the bottom end of it.
If I played before the adjusted EBITDA guidance by INR 2 billion to INR 62 billion to INR 66 million on account of a better than expected at one performance.
Speaker 3: We have provided some additional details on how results were compared to our original guidance in the appendix of the surveys presentation.
We have provided some additional details on how the watch when compared to our original guidance in the appendix of this presentation.
Speaker 3: We reiterate our capacity of completed guidance for this fiscal year of between 1.75 to 2.25 gigawatts.
These easily eat all capacity.
<unk> guidance for this fiscal year of between $1 75 to 2.25 Gigawatts.
Speaker 3: Regarding our buyback, we have repurchased by now 38.6 million shares in total since February last year, which represent approximately 35% of the free float at the time of listing.
Regarding our buyback we have repurchased by now $38 6 million shares in total since February last year, which represent approximately 35% of the seafood and the time of the state.
Speaker 3: We have $11 million of authorization remaining, which represents about 4% to 5% of the total fee.
We have $11 billion of authorization remaining which represents about 45% of the total three floors.
Speaker 3: With that, we will be happy to take any questions. Thank you.
With that we will be happy to take any questions. Thank you.
If you have if you wish to ask a question. Please press star one on your telephone and wait for your name to be announced.
Speaker 1: If you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced.
Speaker 1: If you wish to cancel your request, please press star 2. If you own a speakerphone, please pick up a handset to ask your question.
You wish to cancel your request please press star two.
You're on a speakerphone, please pick up the handset to ask your question.
Our first question comes from Puneet Gulati from HSBC. Please go ahead.
Speaker 3: Thank you so much and congratulations on good numbers and good profitability as well. Our first question is on the win BLFs. So this quarter has been particularly good at 42% BLF. Should one consider this to be normal for 2Q or do you think it was higher than the normal?
Yes. Thank you so much and congratulations on good numbers.
Good profitability as well.
Question is on the Zain BLS.
So this quarter is particularly good at 42% Pls should one consider this to be normally fall. Thank you all.
Do you think it was higher than the normal course.
Yeah.
Yeah, Hi, thank you.
Speaker 3: Yeah, Puneet, hi, thank you. No, this year's PLF in Q2 was a little bit, but very marginally, I would say higher than what would be normal. But keep in mind that Q1 is actually significantly lower as well. And so in aggregate, Q1 and Q2 put together is lower than what should have been the case.
The P&L in Q2 was a little bit.
Very marginally I would say higher than what would be normal.
Keep in mind that Q1 is actually significantly lower as well.
So in aggregate.
Q1, and Q2 put together is lower than what should that be the case.
Speaker 6: OK, understood. So first half is normal, but Q2 higher, Q1 lower.
Okay.
So first off as normal, but still too hard to handle.
Speaker 3: Yeah, first half is a little bit less than normal, but Q2 is a little bit higher than normal, and Q2 was lower, and so therefore, overall, we are ending up a little bit lower than the overall X1 expectation would have been.
Yeah first half was a little bit less than normal.
But Q2 is a little bit higher than normal nature towards Florida, and so therefore overall, we had a little bit lower than the overall law.
From a expectation would have been.
Speaker 6: Secondly, can you also update on one of the acquisitions that you announced a few quarterbacks? What is the progress there?
Okay understood.
It can be can also bid on.
The acquisitions that you announced a few quarters, but.
What is the progress there.
Yeah, I'll, let can actually bad.
Speaker 4: Yeah Puneet, so on the acquisition that we had announced, there was a lot of delay which happened in getting the approvals because those assets were sitting in a partnership firm and they had to demerge it into a company and the approvals for that demerger took a
The operating it's cool on the a question that we had announced so you know there was a lot of deliveries happened in getting their bird.
Because those assets are sitting in a partnership for them and that could be measured into our company.
And the approval for the merger took a lot of time.
Speaker 7: So that deal reached a long stop date and we decided we didn't want it because the entire market had taken so much time for this process to get completed that we didn't want to wait any longer. And we got better opportunities on the bidding side, so we decided to allocate capital more on the organic front.
You know the deal this along scrubbed it and we decided we didn't want to there because.
It'll be in that market attack or hurdle for taking so much time produce their process to get completed but we don't want to wait any longer and we got better opportunities on the bidding side, who decide to allocate capital more on the organic front.
Yeah.
And then no synergies that we have to pay for that.
No no penalties.
Speaker 4: There was some transaction cost which was involved, an initial cost which was less than a million dollars. That was your total cost that was involved.
There were some transaction costs, which are embroiled in to crosses her.
There's a million dollars that's never hear talk of course not.
You know we ended up in getting on it.
Speaker 6: Okay, okay, and secondly, so much you announced in this year, a lot of PPS have been, a lot of bids have been announced, tendering has happened, some PPS being signed. Do you have a similar number for FY23? What kind of, you know, bids got announced and how much PPS has been signed and what is the backlog for that?
Okay.
Okay.
So month you announced.
Yes lot of these guys have been a lot of bids.
They've been announced entering has happened some PPA has been fine.
You have a similar number for FY2023.
What kind of.
CT analysis how much.
<unk> has it been kind of goes into the backlog and all that.
Speaker 3: From FI23, so you know, Puneet, it's very hard for me to give a number because FI23, we actually hardly won any capacity. We just had a 3% market share last year. And, but I should tell you that our Secchi 8 solar, which is the outstanding, which in fact we haven't put anywhere in the presentation. But, therefore, Nathan, you have to tell me whether I can talk about that or not.
So insightfully piece. So you know, it's very hard for me to give a number because it's like what do you see actually hardly any capacity, we just a lot of people in market share last year.
But I should tell you that our psyche is.
So now because we are spending which in fact, we have looked at.
But anyway in the presentation, but.
I. Therefore, Nathan you haven't got any more that I can talk about that.
Yeah go ahead Smith okay.
Speaker 3: Okay, so the second aid, which was an outstanding 200 megawatts that people also were fine.
Okay. So it's like he is which is an outstanding 200 megawatts.
That'd be the launch of all time now so.
Speaker 3: So of the 13.7 or 13.8 that we now have, everything is fully signed PPAs. So there's nothing that is now not signed. So the only point I'm trying to make is that all PPAs are now getting subverted quite rapidly. And with power demand going up, there's definitely interest among the discount.
The $13 seven or eight that Tmall has everything is fully signed ppas. So there's nothing that is mall north side. So the point I'm trying to make is that all ppas imagines the blood, it's quite rapidly and with Pablo demand going up there is definitely interest amongst them. This fall to what effect he didn't try to convert some of the auction and Dupont.
Speaker 3: to go to SECI and try to convert some of the options into firm PTAs. But you know, Puneet, the process is a long one because the distribution utilities have to first, of course, go through the commercial implications. Then they have to go to their local regulator and get the approval of the tariff. That's
But you don't believe the process is a long run because the distribution utilities have to first of course most of the commercial implications then they have to go to their local regulator.
And get the approval of the status.
That causes it doesn't take a month ago, then they come back to the.
Speaker 3: Then they come back to the SECI and then basically go ahead and sign the PSA. After the SECI signs the PSA, they're done. So that whole process can take several months to get consummated. And in auctions where there is a central acquirer, they have to go to the central regulatory authority.
Safety and then basically go ahead and find a PSA after which I decided to give it back so that whole process can take several months to get consummated.
In auctions, where there is a central Florida they have to go to the central regulatory authority.
Speaker 3: So, for example, a couple of bids that we won back in April-May are now sitting with the central regulator, CRC, for approval.
So for example.
A couple of breaks that we bought them back in.
It to me now sitting with the central regulators he I see for the pool and you know it's just a process. It's just like you're speaking.
Speaker 3: And, you know, it's just a process issue, frankly speaking, you know, it just takes a little bit of time. And so, the process of conversion of these bids to PPAs is happening, it's in the works, and I think progressively as some of these approvals from the regulators come through, you'll see some of that getting announced.
This takes a little bit of time and so the conversion of these big two ppas is happening within the books and I think it'll get somebody at Columbia, Peru, something they're going to get some food E T found that getting announced.
Speaker 6: And any reasonable expectation of the 2.9 left? How many of them should you see, you know, PPS getting signed this year at some?
And then near these levels of expectation.
Two nine left how many of them.
Yes.
Is there anything just yet.
I would imagine that most of that's only 5%.
Speaker 3: Yeah, it's hard to say, but I would imagine most of them should get signed.
Yeah, it's hard to say, but I would imagine most of them shook their side certainly some of the more the mainland the loved one sure.
Speaker 3: Certainly, some of the more plain vanilla ones should.
Speaker 3: But then, of course, there is also some complex options. Complex options, as you know, does require a longer lead time to convert to TPA, simply because they are, by definition, complex.
But then of course there is also some complex auction complex auctions as you know that was required.
Longer lead times and come out to be did simply because they are by definition complex and therefore, the storms also take a longer time to understand them and then be able to get that wasn't done in the pool and then also to that extent designate those take longer to understand that for the whole class is that conversion of complex option. Two is just a little bit longer but.
Speaker 3: And therefore, VISTOM will also take a longer time to understand them and then be able to get their own internal approvals. And then also to that extent, regulators take longer to understand.
Speaker 3: So the whole process of conversion of complex options is just a little bit longer. But you know, the reality is that for us, there is no urgency at all right now on some of these, because for the capacity that we want, these are things that we want to construct only in FY26.
You know the reality is that for us to be there there's no urgency at all right now on some of these because for the capacity that Iran.
So yes, I think when it comes back to me and in fact, when you see.
Speaker 3: And so, you know, we have time on our side to get them signed. Meanwhile, I should tell you that for all the projects that we've got LOAs, we've already blocked transmission capacity.
And so you know we have time on our side to get them signed Meanwhile, I should tell you that's what all the projects that he Bob Hey, Louise we've already locked transmission capacity. So transmission capacity has been blocked.
Speaker 3: So transmission capacity has been blocked. Land, we have, obviously, we're working on that right now. But eventually, we will convert them into actual sort of deals when the PPAs do get signed as we go forward. And keep in mind that our clock to execute starts ticking only once the PPAs.
Oh man, we have you know obviously, you're working on that right now, but eventually we will convert them into action.
You know sort of club deals when the Ppas signed.
Kind of as you go forward and keep in mind that our clock to execute Scott's taking only once the P. P a ton.
Speaker 6: But you have land for the entire three and a half, which you want to do.
Alright.
Do you have nine towards the Internet three <unk>.
Speaker 3: Yeah, I mean, you don't have to acquire it right now, you know, as long as we have good line of sight into where that land is, you know, in some cases, you can block the land without actually paying any real significant amount of money. But the important thing is as long as you block the transmission capacity, then you know, that's the most critical factor. And with the LOAs in hand, we are in fact able to block the transmission capacity.
Yeah, I mean, you don't have to acquire right now we don't do as long as we have good line of sight into get that back.
You know in some cases, even blocks alignment that you're paying for them.
A significant amount of money, but the important thing is that as long as you lost the transmission capacity. Then you know that's the most critical factor and when he leaves in hand, we are in fact able to block the transmission capacity.
Speaker 3: And so for all the capacities that we have, all the 3.1 gigawatts that we run, we have blocked the transmission capacity for all of them.
So it's sort of all the capacity that you have all the people on one gigawatt that you've won.
We have lost.
At Jackfish and get back to put all of that.
Speaker 6: Understood, that's very helpful. And lastly, any progress on asset recycling, anything that you did in Q2 and what's the outlook for the second half?
Understood.
And lastly.
Any progress on.
Thanks Lee.
Anything that you did in Q2 and what's good for the second half.
Speaker 4: So, we have consummated transactions of almost around $93 million till date and we are working on a few in the pipeline. The timing on asset sales is really hard to say because when the deals get done, how much will get done in Q3 versus Q4, we are working towards that.
Yeah.
Yeah could we have a consumer transactions off almost around the $93 million could it be.
And are we are working on the appeal or in the pipeline or the timing of when I consider you know really hard to see.
I was going to win the deals get done for how much we get done in Q3 versus Q4 or were working towards it.
Yeah.
Speaker 6: And $93 million would include the Benkari acquisition and the three years.
And $93 million mortgage loan had been Gary.
Thank you Shannon.
Speaker 4: That's right, it includes the two deals, three deals rather, is the Gentari deal, the 100 megawatt sale to Technic Solar, and the third one is the amount that we got from North Ford for the transport.
That's correct.
The school is a cookie cutter as they've been.
That is the 100 megawatt scale.
They can cooler and the third one is the amount that we got from North Hornberger conflict method.
Speaker 6: Okay, understood. Thank you so much and all the best.
Okay.
Thank you so much and unaudited.
Thank you Scott.
Yeah.
Speaker 1: The next question comes from Justin Clare from Roth MKM. Please go ahead.
The next question comes from Justin Clare from Roth and Kam. Please go ahead.
Yes, hi.
Speaker 8: Yes, thanks for taking our questions there. So, I want to ask just about the.
For taking my questions here.
So I wanted to ask just about the.
Speaker 8: I'm out of capacity here. So there's, you know, it seems a significantly larger opportunity for renewable projects here in terms of the auctions that are expected annually. So I was wondering if you just speak to the potential for bottlenecks to emerge, given the larger volume of capacity. And then, you know, maybe you could speak to your strategy in in managing those potential bottlenecks.
The amount of capacity here.
Yes, it seems a significantly larger opportunity for renewable projects here in terms of the auctions that are expected annually. So was wondering if you just speak to the potential for bottlenecks to emerge given the larger volume of capacity and then you know maybe you can speak to.
Of your strategy in managing those potential bottlenecks.
Speaker 3: Justin, thank you so much for the question. But you know, you've asked me a question that I can spend many hours.
Justin Thank you so much for the question, but you know you lost me a question that I keep spending money.
Speaker 3: with you as you can imagine because this is obviously essential to our business. But just to give you a very quick sense of that, I think the key issues that are required for executing a project, of course, are PPAs, which as we discussed, there's ample opportunity for us to bring capacities there. The second is transmission, and that is not a limiting factor right now because the government is building transmission capacity at quite a rapid pace.
Gotcha.
And because this is obviously essential to our business, but just to give you a very quick Oh.
The Central Bank I think the key issues that are required for that.
Executing a project of course, our Ppas, which as we've discussed there's ample opportunity for that you didn't get basketball.
The second is transmission.
And there is a really bad there's not a limiting factor right now because the government is believed transmission capacity quite at quite a rapid pace.
Speaker 3: And as I said, once we win an LOA or we win a bid and get the LOA, then we're able to block the transmission capacity. And if there is no transmission capacity available, then the execution timelines are automatically moved forward.
And as I said once he has been in any way or we win a bid and get the other way then you're able to block the transmission capacity and if there are no transmission capacity available than the execution time, then that automatically move forward. So transmission does not become therefore, a problem for us too.
Speaker 3: So, transmission does not become, therefore, a problem for us to rule out.
To go out and you should not become the brothers land land of course, we are working on constantly and we are always trying to look at what is the forward pipeline and you're trying to block landfall.
Speaker 3: The third is land. Land, of course, we're working on constantly and we're always trying to look at what is the forward pipeline and we're trying to block land for, you know, three years out, four years out project.
At three years out four years out got it.
Speaker 3: and we're also obviously putting up a number of net marks in different parts of the country. We have several hundred net marks that are now up and running to measure gain. And in solar, we have blocked by a number of mechanisms.
And then also obviously putting up a number of next March in different parts of the country you have several hundred mcmuffin them, all up and gummy two major games and solar.
Blocked by a.
A number of mechanisms.
Speaker 3: transmission capacity in the state of Rajasthan, which allows us to execute projects even for two, three years beyond our existing pipeline.
We shouldn't get back to you in the theaters at the Sun, which allows us to execute topics even for two three years beyond.
Pipeline.
Speaker 3: And there is a lot of land available in Rajasthan for solar projects, so land is handled on that basis.
So and then there's a lot of land available in that core set of topics.
One is handled on that basis, and then of course, there's the issue of people and organization.
Speaker 3: And then, of course, there's the issue of people and organization. That is something that, you know, we have our own in-house capability of execution in both wind and solar, and that is something that we constantly re-evaluate, and we are looking at scaling that up, but slowly, because, obviously, we want to build an organization that is high quality, and our execution capacity should be sustainably improving rather than just sort of going up on a one-time basis.
Things that you normally have led to an in house capability and execution in both wind and solar and that is something that we constantly evaluate and we are looking at.
Slowly because obviously, we want to build an organization that is a that is high quality and that execution adults, who should be sustainably improving Bob I'm, just sort of going up on a bump on business and then of course, there is the issue of a Japanese and capitalized.
Speaker 3: And then, of course, there is the issue of capital.
Speaker 3: And capital, I think we are looking at between a mix of internal capital and asset recycling to raise capital for funding some of these projects. So I think that's how we're looking at these five key areas. The sixth actually is supply chain. And there obviously we have as the largest wind player in the country very key relationships with the important OEMs which go out a few times a year.
Between a mixture of internal capital.
Recycling capital for funding some of these projects. So I think that's how we're looking at these five key areas with fixed actually ease the supply chain.
And then obviously.
Obviously, we have as the largest employer in the country are very key relationships with <unk>.
The important Oems.
We could go out.
A few years and so and again best comes from nimble yet because we are in fact, the largest buyer doesn't go banks in the country and that's why that's what I was concerned.
Speaker 3: And so, and we get, you know, best terms from these wind orients, because we are in fact the largest buyer of wind turbines in the country.
Speaker 3: And as far as solar is concerned, as I have discussed multiple times with all of you, that's an area where government policy is evolving and changing. And therefore, we have tried to stay one step ahead of government policy by making sure that we have invested as much as we need to have that security of supply.
He discussed multiple times with all of you are that's an area. The government policy is evolving and changing and therefore, we have tried to stay to stay one step ahead of government policy by making sure that we have.
As much as we need to have that security of supply and that therefore, it also allows us to keep bidding there's a high degree of confidence around being able to source and procure that automobiles and that's actually coming with a little bit of a competitive advantage. So that's those are some of the issues that we are working on to.
Speaker 3: And that therefore also allows us to keep bidding with a high degree of confidence around being able to source and procure our own modules. And that's actually becoming a significant competitive advantage.
Speaker 3: So that's, those are some of the issues that we are working on to make sure that we're able to continue to do, you know, two, two, two to three, and then sort of bigger once a year, and then try to increase that, you know, in seven years down the road. I hope that answers your question. Got it. Okay.
Make sure that we're able to continue to execute you know 222 to two and then sort of.
Lots of young and then striking is that are you know instead.
In fact in years down the road.
I hope that answers your question got it okay.
Yeah, No very helpful and then I guess.
Speaker 8: And then I guess just on the supply chain, you know, you have your own in-house module manufacturing today. I was wondering if you could share what the cost structure was for the modules that you're producing in-house and how that might compare to what's available in the market, you know, including the cost of the import duty.
Just on on the supply chain.
Your own in house modular manufacturing today I was wondering if you could share what the cost structure was for.
The modules that you're producing in house, and how that might compare to what's available in the market.
The constant the import duty and and how this might give you a relative advantage in terms of your cost structure.
Speaker 8: and how this might give you a relative advantage in terms of your cost structure.
Speaker 3: Yeah, Nathan, we haven't come out with those numbers right now, right, but please, please reconfirm.
Yeah, Nathan we haven't come up with those numbers right now right.
Excuse me can come.
Speaker 2: No, not just yet, but I mean, if you want to give some ranges, that's fine.
No not just yet, but I mean, if you want to give some ranges that's fine.
Speaker 3: Okay, thank you. So yeah, Justin, the thing is that, as you know, import duties in India for solar modules are about 40 percent, and that gives us sufficient protection against imported modules. The cost differential between what we produce in India and what is produced in China, just for the module, in our estimation is about 10 to 15 percent.
Okay. Thank you Sir.
Yeah, Justin the opinion is that as you know are import duties in India are forcing them all you've done about 40% and that gives us sufficient protection against the against the imported modules.
The cost differential between what people use in India and when it's been used in China.
Just for the module.
In our estimation is about 10% to 15% and so the 40% prediction is sufficient to do allow us to not have that as there is an issue for us.
Speaker 3: And so the 40% protection is sufficient to allow us to not have that as an issue.
Speaker 3: The second thing is keep in mind that we also have the approved list of models and manufacturers, which is really a hard barrier to imports, which the government had imposed from this April , but had deferred it for a year, and it is coming back in April of next year, which will then prevent any imports from coming in at all, notwithstanding any duties and everything else.
The second thing is keep in mind that drum that way. We also have to be approved Mr. Module manufacturer, which is really a hard barrier to imports, which the government had inflows from this April than they had before.
Further for a year and it is coming back in April of next year, which will then commence immediately brought some coming in at all.
Notwithstanding any duties and everything else and so at that point, if you're logging when does it become a cost issue. It would become an availability issue because anybody who has access to the models will be able to continue to execute projects and people, who don't obviously they might be able to a center that module supply next year.
Speaker 3: And so at that point, it will not even just become a cost issue. It will become an availability issue. Because anybody who has access to modules will be able to continue to execute projects. And people who don't, obviously, will not be able.
Speaker 3: Our sense is that module supply next year will be, you know, will be in deficit because obviously, you know, while capacity is coming up, it does take time to essentially get it to a level where people have good quality and stable production in place.
We'll be in you know it will be in deficit, because obviously like if that keeps coming up it does take time to essentially to get into a level of dead.
People, who have good quality and a stable production in.
Please.
Speaker 3: Having said that, our sense also is, although there is no specific data that is there that allows us to point to, but just based on people that are working with us and so on, our cost of production is very comparative among other Indian countries.
Having said that our sense also is although there is no specific data that is that that allows us to the point too, but just based on you know people that are working at lucky charm.
Our cost of production is very competitive among other Indian.
Speaker 3: So that is really also something that we would like to benchmark ourselves to.
So that is really also with something that you would like to benchmark ourselves.
Okay I appreciate it thank you.
Thank you.
Speaker 2: And Samant, there's actually an inbound email question from Garish at Morgan Stanley that is related to that. So if I could just ask this. Basically, are we open to selling a minority stake in our solar manufacturing? And there seems to be an overcapacity coming online in Indian, given strong response to PLI. What are our thoughts about that?
And some aren't there's actually Oh inbound email question.
From Korea shut Morgan Stanley that is related to that so if I could just ask this basically are we open to selling a minority stake in our solar manufacturing.
And there seems to be an overcapacity come.
Coming online in India, given strong response to be aligned what are our thoughts about those.
Yeah.
Speaker 3: Yeah, so, no, we certainly are open, you know, we're not willing to keeping 100% of the solar plant. As we've stated many times, the reason that we've set it up is to assure ourselves of supply security. And as long as we're able to do that, we are, you know, that meets our primary objective.
Yeah. So.
So to me I.
Open.
Keeping 100%, so and as long.
As we stated many times the reason that you've set it up is to assure that the.
Supply stability and as long as we're able to do that.
You know that that eats up down to the objective.
Speaker 3: As far as overcapacity is concerned in the Indian market, that is something that we have
As far as you look at that as these concerns in the Indian market.
That is something that we'd have to vacancy.
Speaker 3: because obviously while there are a lot of people who have announced land.
Because obviously you guys laid out a lot of people who've announced plan how many of those actually Fructify you wouldn't have to we'll have two.
Speaker 3: how many of those actually certify, we will have to, we'll have to.
Speaker 3: monitor. And the second thing is also that a lot of the earlier capacity that have been set up are actually going to become uncompetitive because we just won't have
Monitor and the second thing is also that a lot of the capacity that had been set up and actually one of them become uncompetitive because they just won't have the efficiency. The production of the ability to make the latest generation of module. So to some extent so it'll be a net capacity would have to be discounted.
Speaker 3: either the efficiencies of production or the ability to make the latest generation of modules. So, to some extent, some of the earlier capacities will have to be discounted.
Speaker 3: in the calculation of the capacities that are coming up.
In the calculation of the capacity that's coming up.
Speaker 3: Um, yeah, so that's, that's, that's not something that, uh,
Yeah. So that's that's that's not something that.
Thank you Jason go ahead to the next question. Thank you.
Once again, if you wish to ask a question. Please press star one on your telephone and wait for your name to be announced.
And our next question comes from actually if I could just add.
Yeah.
Go ahead finish your bank.
Speaker 3: Yeah, no, no. The only other thing I would say is that also keep in mind that a lot of modules are being exported, shipped out of India to the U.S. and other places, and so that also adds to the deficit, and will add to the deficit in the country.
Yeah, No no no no.
The thing I would change that also keep in mind that a lot of modules are being exported shipped out of India to the U S and other places and so that also adds to the deficit and Mike will add to the deficit in the country next year.
Go ahead Jason.
Thanks, and our next question comes from Nikhil <unk> from Bernstein. Please go ahead.
Speaker 1: And our next question comes from Nikhil Nagania from Bernstein. Please go ahead.
Speaker 3: Yeah, thank you. Congratulations on a good set of numbers. My first question is regarding the RTC and peak power projects. Good to see their guidance being maintained, but just wanted to clarify that transmission is not a bottleneck for these two assets. So when they're commissioned in Q4, power evacuations and delivery conditions will start happening.
Yeah. Thank you congratulations on a good set of my most of my first question is regarding the RTC and peak power projects well good to see better guidance being maintained but just wanted to clarify that the transmission is not a bottleneck for the stress and so when they are commissioned in Q4.
But evacuation then there will be accretion should start happening.
Speaker 3: Nikhil, I can categorically confirm that to you, that transmission is not a bottleneck, largely because we are actually building a lot of it ourselves. The very first project opting in RTC, there are three different wind projects and one solar project. The first wind project was making to a substation that we ourselves are making, and that we have now commissioned and that has been charged.
You want to make sure that I can categorically confirm that to you that transportation is not a bottleneck largely because we are actually building a lot of it outside of the very first project offering and in D.
Do you see that at all.
Three different big projects and bumps are not that big.
The first week, it was making to a substation that we all felt somebody and that we have more commission.
And has that had any jobs.
Speaker 3: And so, therefore, we just now we'll be going to the.
And so therefore, we just thought we'd be willing to be.
Connectivity protocols to connect the first projects into that.
Speaker 3: connectivity protocols now to connect the first project into that corporate subsolution that we did. The second one also we are building, actually, which is another subsolution.
That copay substation that because that's a big deal.
The second one also get them to actually be which isn't the other competition.
Speaker 3: And so therefore, obviously, we have clear understanding of and control of when the substations are coming up.
And so therefore, obviously we have good understanding.
And control all member Substations that coming up.
Speaker 3: The third one is getting connected to a substation that has been made by a third party, which we are closely monitoring and getting in touch with them. And that also looks like it's on track, so that should not lead to any problems with that.
The third one is getting connected to a substation that will be made by our Kentucky, which we are closely monitoring them very in touch with them and that also looks like it's on track so back to model it really probably through that.
Speaker 3: So I don't anticipate any transmission-related issues.
So so I don't anticipate any transition related issues.
Initially these projects.
Speaker 6: Correct. Good to hear that. I think the related question then is transmission. I think the point slightly alluded to during the discussion earlier is transmission is being seen as a constraint and they're ramping up to 30, 40 gigs of renewable installation. Are you seeing that as a constraint in reaching that higher renewable installation number?
Got it.
Well I think there's limited question Dennis its transmission I think the point.
Slightly alluded to bring their discussion earlier its transmission is being seen as a constraint and got ramping up too.
People think exhausts renewable installation are you seen that as a constraint in reaching that Ohio didn't even installation number Sunday.
Speaker 3: You know, I would say the government has been so far quite proactive in building on transmission capacity.
I would say the government has been so far quite proactive in building on transmission capacity.
Speaker 3: And, you know, I think a lot of transmission capacity exists in the country that can allow publishers to develop a finished product.
And so.
I think a lot of transmission capacity exists in the country back some allow publishers to be lots of initially.
Speaker 3: The only thing is, of course, that the transmission capacity is not a specific area that people would want to set up or, you know, maybe there's some constraints in places like Rajasthan or Karnataka and so on. And there, there might be bottlenecks.
There's a cost of the transmission capacity as monotherapy in Korea.
As people would want to set up Oh boy you know that maybe there is some constraint and so somebody that was or come out that's been soft.
And then they might be Baltimore.
Speaker 3: as we go forward. But when I say bottlenecks, I mean that, you know, the bottleneck will emerge after 30 gigawatts or 40 gigawatts of connectivity, which will add 10 or 15 gigawatts. So there is a lot of room to go before we actually start having constraints really, really important.
As we go forward, but then I see Balkan makes I mean that you know the bottleneck in the make up of 30 Gigawatts of 40, gigawatts or something because we give out.
Ben.
I know for a few days ago. So there is a lot of room to go before we actually start having constraints really really much. So I would say that at least for the next Oh two.
Speaker 3: So I would say that at least for the next two, three years, we should not be seeing any transmission bottlenecks. And the government is, as you very well know, trying to really speed up the construction of transmission projects and the oxygen of transmission projects. So they are very closely evaluating what the issues are and are trying to debottleneck.
P T cells, you should not be seen transmission.
Transportation bottlenecks and other government payers as you that even though trying.
Trying to really speed up the construction of transmission project can be auctioned off transfers and stuff. It will be very closely evaluating you know what.
The issue is at and I'm trying to Debottleneck that.
Speaker 3: Got it. Thank you. And my last question then is, there was this one big tender, the RTC2 tender, I think, for more than 2 gigawatts, which I think has been going around for quite some time. Any update that could be shared on that?
Got it thank.
Thank you Mike.
Last question. Then is are there wasn't one big tender at a dog P. C. P 10, but I think for more than two gigawatts.
Which I think has even been on for quite some time any updates that could be shared on that.
From the new site.
Speaker 3: on the... I'm not sure which tender you're specifically talking about.
On the.
I'm not sure, which the latest if you're talking about.
Did I T.
Speaker 3: The one that coal was also not to be blended coal fired.
No.
The one that coal was also noted we then did a qualifying condition.
Speaker 6: Ah, okay, okay, okay. No, listen, I haven't heard about that tender for quite some time, so I'm not sure that it is live right now. But as you know, in the meantime, a number of other RTC auctions have happened. TechE6 was the first one that happened. That is for 200 megawatts of headline capacity, which, as you know, translates to about three and a half gigawatts of actuary capacity.
Okay, Okay, well listen I haven't thought about that a tender for quite some time, so I'm not sure that it is right now, but as you know in the meantime, I'm gonna have other all cause he or she can help them take you six was the first one that happened that's what's 100 megawatts of inland capacity, which as you know translates to about three and a half to go up so that's a lot of capacity.
Speaker 3: Then LGVN just recently did another 200 megawatts capacity, which is not actually fully subscribed to, in which we want 184 megawatts.
Then as Julian because we simply didn't although 100 megawatts to get back to what you want to fully subscribe to.
And between 184 megawatts.
Speaker 3: And then there's the RENTL tender as well. So there have been three such tenders in the last few months. And as you know, a number more are teed up to be coming up in the next few months.
Hum.
And then the <unk> 10 minutes, so they've been pretty substandard in the last few months and as you know a number more like the that will be coming up in the mix a few months.
Got it got it thanks.
Speaker 1: Go ahead, call it. Thanks. Thank you so much. Those are my questions. Thank you. As a reminder, if you have a question, please
Thank you so much most of my questions. Thank you.
As a reminder, if you have a question. Please press Star then one and our next question comes from energy storage Lynskey from Seaport. Please go ahead.
Speaker 9: Thank you. So just two simple questions. One, you do lots of capital recycling in existing and future projects.
Thank you so just.
Two simple questions. One you do lots of capital recycling and existing and future projects.
Speaker 10: And so, I'm just wondering if the gains that you record on that are reflected in your EBITDA. So, that's number one. And number two is, when you show us EBITDA and debt projections, just wanted to make sure that this is proportional EBITDA and proportional net debt, meaning the portion of both that you keep as renewed net of those divestitures or asset recycling.
And so I'm just wondering if.
If the gains that you recorded on that are reflected in your EBITDA. So that's number one and number two is when you show us EBITDA and that's projections just wanted to make sure that this was proportional EBITDA and proportional net debt.
Meaning the PR that.
The portion of our folks that you keep as when you net all those divestitures.
Divestitures of asset recycling.
Yeah.
Sure Yeah.
Speaker 4: So the gains on the asset sales have not been reflected in the BIDTA line as of now. I think the accounting transaction happened subsequent to the end of...
Who would be a gain on the asset sales have not been reflected in the Buda lime as of now.
I think the accounting transaction happened subsequent to the end or.
Speaker 4: the previous quarter. So that's the reason why I think it will get accounted in a subsequent period.
The previous quarter. So that's the reason why I think it'll go to Congress and the subsequent period.
Speaker 4: To your second point, where we consolidate the full EBITDA, where we own 51% majority of the assets, there the full debt also gets consolidated with us.
To your second point are rarely consolidated.
EBITDA may be owned 51% majority of the assets.
The foree Bernhardt forgets consolidated with us.
Speaker 4: into the balance sheet, so if we don't control it on a proportional basis because if we are in control of the asset.
And good about them food could we don't go colder on a proportionate basis because of Fiat in control of the asset then the entire the EBITDAR and bird for cruise with us.
Speaker 4: then the entire EBITDA and debt sort of stays with us. We take out the minority interest on account of the joint venture partners' interest in the project.
Go to minority interest on the conduct of joint venture partners interest in the project.
Speaker 2: Sorry, just to clarify, on our guidance that you see there, that is just our
Yeah.
Yes, yeah, sorry, just to clarify on our guidance that you see there that is just our net so if you look at the debt. So it isn't that a minority interest.
Speaker 10: So if you look at the debt, if you look at the income- So it is net of minority interest.
Speaker 2: Yes, so those are actually not to share.
Yeah, So those are actually not to shareholders.
Speaker 2: Okay, so, I mean, again, yeah, actually, we're recording, we would be taking out the net or the minority position in the minority interest line. But as a projection, and our guidance is concerned, it's all net of what we currently.
Okay. So I don't know what tomorrow.
<unk> reported yeah actual record yeah, we would be taking out the net or the minority position in the minority interest line, but as a project in our guidance is concerned it's all right.
Net of what we currently own.
Speaker 9: Okay, that's good. And then just going back to the gains on capital recycling. So, again, I mean, you've done a couple of those transactions in the past, and I'm just wondering, I mean, you know, have those been a meaningful contributor to the EBITDA? I understand the difference in the timing of recognition of the gain for this latest transaction, but I'm just
Okay. That's that's good and then just going back to the games on capital recycling. So.
Again, I mean, you've done a couple of those transactions in the past and I'm just wondering I mean.
Have those been.
<unk> a meaningful contributor to the EBITDA I understand the are this is the difference in AR and the timing of recognition of the gain so this latest transaction, but I'm just just wondering how big of a component of EBITDAR. This this has been or can be again I'm just I know that that's an.
Speaker 9: Just wondering how big of a component of ibadah this has been or can be again.
Speaker 9: I know that that's an ongoing business, but I'm again wondering how big of a position of the ETHID diet.
Ongoing business, but I'm wondering.
Wondering how big of a position that he thought that this is.
Speaker 4: So, see again, you know, there's an accounting value to it. What tends to happen is that, you know, we book costs, basis and accounting calculation on the capital expenditure loss, we include some margins at the EPC levels. When we consolidate them, they get knocked off. When we sell those assets, those assets are marked at a higher value in our books because of the, you know, because we are sort of selling those assets. So, to that extent, the gains are smaller, but the cash flow impact is larger.
Uh huh.
There's an accounting or value to work or what tends to happen is that can we book or a car.
Our bases in accounting or a calculation on the capital expenditure local and group margins.
E P C level, when we consolidated them.
Good good and I'll go through when we sell that occurred records are marked at a higher value in our books or coffee or you know because you had sort of selling those assets that extend the goons are smaller but the classroom factors locker.
Yeah.
Okay.
Yes.
Peter.
Speaker 11: Yeah.
Yeah Yeah.
Speaker 2: And also remember that most of the larger transactions were related to projects that are under construction, right? So our peak power and our RTC projects, right? So those gains would be, well, commercial gains, but accounting gains are, you know, de minimis because they haven't been actually selling of operating assets. That's where you would see gains. So far, there's...
And also remember that most of the larger transactions were related to projects that are under construction right. So our peak lunch hour and our RTC projects right, so and those gains would be well.
Commercial gains, but accounting gains or de minimis, because they haven't been actually selling of operating assets, that's where you would see Kansas So far there's not been much.
Speaker 9: Okay. And then lastly, and again, by now you probably see where I'm going with this, I'm, you know, I'm trying to compare you to other renewable power developers, you know, there's been some
Okay, and then lastly, and again.
Right now, we probably see where I'm going with them you know what I'm trying to compare you to other renewable power developer as you know theres been some differences in how you know that's and then EBITDA as shown so you know you guys do project financing them and I'm just wondering if there is a.
Speaker 9: differences and how, you know, debts and any of that are shown. So, you know, you guys do project financing, and I'm just wondering if there is any reasons for you to change that stance. Like, I don't know, as the balance sheet grows, would you consider balance sheet financing? Again, any changes in how you finance new bills?
Any reasons right. So your for you to change that stance like I don't know off the balance sheet grows would you consider balance sheet financing again any any changes in how you finance a new build.
Yeah.
Speaker 4: Yeah, so again there what happens is that you know obviously we have an existing portfolio which is quite sizable, we have existing debt which is quite sizable.
Yeah. So again, there what happened or it's hard to know because we have an existing portfolio, which is quite sizable we have existing book, which is quite favorable.
Speaker 4: So to change everything to balance sheet, it will take time and it requires a certain type of market environment.
Our teams everything to balance sheet or it will take time.
And it requires a certain type of market environment.
Speaker 4: you know, which is relatively, you know, easy money policy type of market where the rates are lower in which market, you know, you can obviously get, you know, transactions done by getting borrowing balance sheet and then repaying the debt at the OPCO levels. But given that, you know, market conditions are what they are, investors are very focused on getting security on specified assets.
Rick are relatively you know easy money or policy type of market, where the rates are lower and which market. Do you know you can only see good transactions done by good morning balance sheet, and then repaying the debt that'd be our Opco levered.
But given that you're in a market condition that would be at risk or that really focused on getting our security on specified assets.
Speaker 4: And then the lenders typically wouldn't want to consolidate or have in their entities where they hold the security under construction risk because then the risk weightages for them also change.
And then the lender typically wouldnt want to control. It it would have in there are entities, where they are or the security under construction, that's bigger than the risk weighted just for them or for teenagers.
Speaker 12: So we are not moving to a balance sheet type of financing anytime soon. For us, this model really works. And more so in the Indian context, the lenders are project finance lenders to specific assets and they want the full security of that asset without sharing it with any other lenders. So from a bankruptcy remoteness point of view also, that is the preferred model in India. So it seems like we'll have to sort of continue with that. Great, thank you.
Moving to our balance sheet type of financing or anytime soon for that this model really works and motor in the Indian context, you know the lenders on project finance lenders or specific asset and they wanted to perfect clarity over that I think are we don't heading in with any other Linda for from a bankruptcy. The morgans point of you or her that cause the preferred.
In India. It seems like we'll have to hurdle Franklinia Rebecca.
Great. Thank you.
Yes.
Yeah.
There are no further questions at this time that does conclude our conference for today. Thank you for participating you may now disconnect.
Speaker 13: Thank you.
Thank you.
Okay.
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