ReNew Energy plc(US:RNW)2024-11-20 18:39Financial Data and Key Metrics Changes - The company reported a 14% growth in adjusted EBITDA for the quarter, driven by cost optimization [16] - Profit after tax increased by 31% year-on-year, attributed to lower general and administrative expenses and finance costs [16][31] - Cash from operating activities rose to approximately INR 20.1 billion, marking a nearly 10% increase year-on-year [33] - Net debt to EBITDA leverage at the operating asset level remains below 6x, with a trailing 12-month leverage of around 5.9x [34] Business Line Data and Key Metrics Changes - The company commissioned 860 megawatts in the fiscal year to date, with an additional 350 to 400 megawatts expected to be commissioned in the third quarter [12][21] - Total operating capacity grew by approximately 30% net of assets sold in the last fiscal year, with the total portfolio increasing by about 18% [13][31] - The contracted portfolio expanded from 13.8 gigawatts in September 2024 to 16.3 gigawatts, including 900 megawatt hours of battery storage capacity [14][15] Market Data and Key Metrics Changes - The Indian economy is expected to grow at more than 7% in the current fiscal year, which is anticipated to positively impact the company's operations [11] - The company has secured an external order book of over 900 megawatts, ensuring surplus capacity is sold in the market [18] Company Strategy and Development Direction - The company is focused on delivering megawatts and accretive growth while expanding its contracted pipeline [10] - A strategic move into manufacturing was made to secure the supply chain, as India restricts imports of solar modules [26] - The company aims to maintain capital discipline and target levered returns of 16% to 20% [24] Management's Comments on Operating Environment and Future Outlook - Management highlighted the urgency of transitioning to sustainable energy sources due to extreme weather changes globally [8] - The company is on track to meet its megawatt guidance despite challenges in wind execution and has reaffirmed its adjusted EBITDA guidance [49] - Management expressed confidence in the ability to navigate supply chain bottlenecks and connectivity issues, ensuring project timelines remain intact [22] Other Important Information - The company achieved carbon neutrality for the fourth consecutive year and reported a 10% reduction in Scope 1 and 2 emissions [40] - The company has been recognized for its sustainability efforts, including awards for safety and innovation [44] Q&A Session Summary Question: Update on RTC project completion and transmission readiness - Management confirmed that the RTC project is on track for completion in the second half of fiscal 2025, with no expected delays in transmission [54] Question: Impact of proposed restrictions on cell manufacturing - Management indicated that the government is considering imposing restrictions on cell imports, and the company is actively considering expanding its cell capacity [58] Question: Drivers of cost optimization - Management noted that cost optimization has been driven by renegotiating contracts and canceling discretionary spending [62] Question: Clarification on wind PLFs - Management explained that the average PLFs for the quarter were down due to conservative forecasting, with current performance likely at P85 to P90 levels [79] Question: C&I portfolio execution timelines - Management stated that half of the 1.3 gigawatts in construction is expected to be commissioned this year, with no significant challenges reported [80] Question: Stability of finance costs despite increased gross debt - Management attributed stable finance costs to hedging strategies and refinancing of high-cost debt [81] Question: Write-back on provisions - Management quantified the write-back on O&M equalization reserves at around INR 60 crore [82] Question: CapEx guidance for the remainder of the year - Management indicated that remaining CapEx for the year is expected to be around $200 million to $250 million [95]