ReNew Q2 Results-Highest Ever Profits, Portfolio At 13.8 GW

ReNew Energy Global Plc delivered on its promise to investors with a consistently improved performance for the three-month period ended September 30, 2023. This was indicated in its recent Q2 results. The firm continues to guide for 1.75 GW to 2.25 GW net additions to its portfolio this financial year. This is expected to ramp up to 2.5-3.0 GW per annum in FY25- FY26.

Operating Highlights in Q2:

As of September 30, 2023, the Company’s portfolio consisted of 13.8 GWs, compared to 13.4 GWs as of September 30, 2022, of which ~8.3 GWs are commissioned and 5.5 GWs are committed.

Total Income (or total revenue) for H1 FY24 was INR 53,291 million (US$ 641 million), compared to INR 47,416 (US$ 571 million) for H1 FY23. Net profit for H1 FY24 was INR 6,754 million (US$ 81 million) compared to a net loss of INR 1,090 million (US$ 13 million) for H1 FY23. Adjusted EBITDA for H1 FY24 was INR 39,897 million (US$ 480 million), as against INR 38,366 million (US$ 462 million) in H1 FY23. Cash Flow to equity (“CFe”) for H1 FY24 was INR 18,930 million (US$ 228 million) compared to INR 21,040 million (US$ 253 million) in H1 FY23.

Total Income (or total revenue) for Q2 FY24 was INR 28,632 million (US$ 345 million), compared to INR 22,409 (US$ 270 million) for Q2 FY23. Net profit for Q2 FY24 was INR 3,771 million (US$ 45 million) compared to a net loss of INR 986 million (US$ 12 million) for Q2 FY23. Adjusted EBITDA for Q2 FY24 was INR 21,298 million (US$ 256 million), as against INR 18,209 million (US$ 219 million) in Q2 FY23. Cash Flow to equity (“CFe”) for Q2 FY24 was INR 9,346 million (US$ 112 million) compared to INR 7,125 million (US$ 86 million) in Q2 FY23.

FY24 Guidance

The company has raised the lower end of its FY24 Adjusted EBITDA guidance range by 3% and continues to expect to complete construction of between 1,750 to 2,250 MWs by the end of Fiscal Year 2024.

In it’s investor presentation accompanying the results, it highlighted an improved performance from its wind assets, 41.3% wind PLF in Q2 FY24 compared to 32.7% in Q2 FY23. Pointing to the rising power demand in India, the firm highlighted an ~83% increase in auctions in Q2 FY24 vs Q2 FY23  with  ~51 GW(1) of auctions active YTD FY24. The firm claims that it is seeing lower participation at higher tariffs in auctions this year, with complex auctions(Solar+Wind+Storage)  getting 1.25-1.5x subscriptions.

Falling module prices have delivered gains of $100-120 million to the firm vis a vis costs in November 2022, improving project IRRs. Its150 MWh battery project is on track at its peak power project, the single largest BESS at any site in India, and will provide power for 2+4 hours.