Release Date: January 24, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Adani Green Energy Ltd (BOM:541450, Financial) contributed to 15% of nationwide new solar capacity and 12% of new wind installations in 2024, highlighting its leadership in the renewable energy sector.
- Energy sales increased by 23% year-on-year to 20 billion units, with revenue from power supply rising 18% year-on-year to INR 6,829 crores.
- EBITDA from power supply grew by 18% year-on-year to INR 6,366 crores, and cash profit surged by 23% year-on-year to INR 3,630 crores.
- The company added 3.1 gigawatts of greenfield capacity, marking a 37% growth and bringing the total operational portfolio to 11.6 gigawatts, the largest in the country.
- Adani Green Energy Ltd is making significant progress in expanding its PPA pipelines and is committed to delivering above-market return expectations with a strategic objective of 50 gigawatts by 2030.
Negative Points
- Extended monsoon and regulatory changes have caused a shift in the construction timeline, affecting the capacity addition targets for the year.
- There are challenges with transmission delays, which have shifted many projects to the right, impacting project timelines.
- The company faces potential cost increases due to ALMM and ALCM compliance, although it expects these to stabilize as domestic manufacturing capacity grows.
- DISCOMs are showing reluctance to sign PPAs due to a backlog, posing a challenge for securing long-term agreements.
- The company is cautious about aggressive competitive behavior in battery storage tenders, which could impact the attractiveness of storage costs.
Q & A Highlights
Q: Can you provide details on your full-year capacity addition target and the focus on battery storage?
A: Amit Singh, CEO: We aim to add approximately 5 gigawatts of new capacity this year, with 4.3 gigawatts expected by the end of this fiscal year. The remaining capacity will be ready shortly after. For battery storage, we see a long-term trend of growth and aim to take a leadership position, focusing on RTC power demand and C&I customers.
Q: What is the impact of recent regulatory changes and market conditions on your operations?
A: Amit Singh, CEO: Extended monsoons and regulatory changes have slightly shifted our construction timelines. However, we are on track to deliver 5 gigawatts this year. We are also adapting to changes in battery prices and transmission charges, which influence our strategy.
Q: How are you addressing the challenges of grid connectivity and solar cell import restrictions?
A: Amit Singh, CEO: We are working closely with stakeholders to align project execution with transmission readiness. We are also building relationships with domestic suppliers to mitigate the impact of ALMM and ALCM compliance, ensuring a stable supply chain.
Q: Can you explain the reduction in finance costs and the deferred tax number?
A: Saurabh Shah, CFO: The reduction in finance costs is due to the repayment of holdco bonds and favorable refinancing. The tax benefits come from deductions related to distributions, which will continue to impact our tax bracket.
Q: What is your strategy regarding merchant capacity and renewable energy certificates?
A: Amit Singh, CEO: We are focusing on merchant capacity, especially in wind, to take advantage of market conditions. The gap between day and night power prices presents opportunities for battery solutions and RTC power offerings.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
