ReNew Energy plc(US:RNW)2024-06-06 16:56Financial Data and Key Metrics Changes - The company reported its first profitable year since listing, with a profit of INR4.1 billion or $0.12 per share [53] - Adjusted EBITDA for FY '24 was INR65.6 billion, slightly below the top end of the initial guidance range of INR66 billion [53][87] - Cash flow to equity was INR13.7 billion, exceeding guidance and including a gain of INR3.7 billion from asset sales [53][87] Business Line Data and Key Metrics Changes - The operational capacity increased by 1.9 gigawatts during FY '24, with 1.174 gigawatts from solar and 768 megawatts from wind [94] - The company’s contracted portfolio now stands at 15.6 gigawatts, including 2.2 gigawatts of recently signed agreements [54][94] - Wind plant load factors (PLFs) improved to 26.4% from 25.5% the previous year, while solar PLFs were slightly lower due to weather impacts [94] Market Data and Key Metrics Changes - India auctioned over 62 gigawatts of renewable energy capacity in FY '24, significantly surpassing the target of 50 gigawatts [37][61] - The demand for electricity in India has risen around 8% on average over the past four years, with peak demand hitting new highs [59][60] - The auction market has seen a four-fold increase in RE auctions compared to the previous fiscal year, indicating a robust market environment [57] Company Strategy and Development Direction - The company aims to deliver a pipeline of over 21 gigawatts by 2029, focusing on growth opportunities where returns exceed the cost of capital [30][31] - Asset recycling is a key strategy, allowing the company to fund growth without issuing new shares and enhancing returns [40][89] - The company is shifting its project development strategy to co-locate wind and solar projects to optimize transmission costs [21][19] Management's Comments on Operating Environment and Future Outlook - Management anticipates a surge in industrial demand growth in sectors such as electric vehicles and data centers, which will boost power demand [38] - The company expects to achieve 16% to 18% annual growth in adjusted EBITDA through the end of the decade, driven by internal cash flow generation [39][43] - The management noted that the renewable energy landscape is favorable, with declining solar module prices and increased auction tariffs expected [55][60] Other Important Information - The company has secured access to over 10 gigawatts of connectivity for future projects, ensuring competitive advantages in bidding [76][78] - The company has received recognition for its ESG efforts, being named among the top rated ESG companies by Sustainalytics [100] Q&A Session Summary Question: Are the outputs from the newly operational complex projects in line with expectations? - Management indicated that it is too early to assess the performance of the complex projects as they are not yet fully operational [5] Question: Are there any performance issues with older wind assets? - Management reported no significant performance issues with older assets, which are only 12-13 years old [8] Question: What implications do recent transmission changes have on strategy? - Management noted that while there hasn't been a significant change in behavior yet, the upcoming changes could lead to a shift in procurement strategies among states [14][15] Question: How does the company plan to fund its growth? - The company plans to fund growth through a mix of asset sales, cash on balance sheet, and internal cash generation, without needing to raise equity [93][86]