Indian Energy Exchange Ltd. · NSE:IEX
Indian Energy Exchange — Q4 FY2024 Earnings Presentation
45 slides from Indian Energy Exchange's earnings presentation, May 16, 2024
Slide 1: Exchange filing cover letter
Dated: May 16, 2024 The Manager The Manager BSE Limited National Stock Exchange of India Ltd Corporate Relationship Department Listing Department Phiroze Jeejeebhoy Towers Exchange Plaza, 5th Floor, Plot No. C/1 Dalal Street G Block, Bandra Kurla Complex Mumbai- 400001 Bandra (E), Mumbai-400 051 Scr
Slide 2: Investor Presentation – Q4 FY'24 & FY 2024
Investor Presentation – Q4 FY’24 & FY 2024
Slide 3: In this presentation
In this presentation: Sector in Transition Electricity Value Chain IEX: Who We Are Indian Gas Exchange (IGX) International Carbon Exchange (ICX) Way Forward 2
Slide 4: Sector in Transition
Sector in Transition Shifting Energy Mix Deployment of Low-Carbon Decarbonisation Technologies - Wind and Solar % Renewable 50% 43% 33% Small-scale Generation Decentralisation Across T&D Network FY 2010 FY 2024 FY 2030 FY 2010 FY 2024 FY 2030 Empowered Consumers - Economic Democratisation Power Shif
Slide 5: In this presentation
In this presentation: Sector in Transition Electricity Value Chain IEX: Who We Are Indian Gas Exchange (IGX) International Carbon Exchange (ICX) Way Forward 4
Slide 6: Electricity Value Chain
Electricity Value Chain Generation Transmission Distribution & Consumption Energy Transition World’s Largest Network Reforms Underway Installed Capacity As on FY 2030 ➢ Inter-reg. trans. Cap.: 112.3 GW ➢ Avg. AT & C Losses: FY’21 – 22.3%; 31 st CEA FY’22 – 16.4% Mar’24 Proj. ➢ 4.81 Lakh CKM of trans
Slide 7: Installed Capacity = 442 GW
Installed Capacity = 442 GW Capacity by Source Capacity by Ownership 47 GW 8 GW Hydro Nuclear State Central 104 GW 108 GW 144 GW 243 GW Renewable Thermal Private 229 GW Data as on 31st March 2024 6
Slide 8: Sector Construct
Sector Construct Long-Term (85%) Long-term (89%) Short-Term (15%) Total Power Generation FY’24*: 1,382 BU Bilateral: Exchanges: Up to 25 years DSM Less than 1 year Real Time (1hour) – 90 days 85% 5% 8% 2% Day Ahead Market, Real Bilateral & Time, Intraday, Contingency, Banking Term Ahead up to 90 day
Slide 9: Exchange Markets are growing fast
Exchange Markets are growing fast Exchanges (BU) Bilateral (BU) DSM (BU) CAGR: 14% CAGR: 2.5% CAGR: 1.3% 17.8% YoY 11.1% YoY 1.2% 101 103 110 YoY 80 56 67 58 60 65 64 26 44 25 25 25 54 56 24 48 23 23 FY18 FY19 FY20 FY21 FY22 FY23 FY24* FY18 FY19 FY20 FY21 FY22 FY23 FY24* FY18 FY19 FY20 FY21 FY22 FY2
Slide 10: Immense Potential to Deepen India's Power Market
Immense Potential to Deepen India’s Power Market 91% 49% 47% 39% 34% 23% 15% 8% Nordpool Germany UK Netherlands Switzerland Belgium France India Note: Data for India till Feb’24 Source: CRISIL Study Markets are in the range of 30-80% in developed economies. At 8%, India has an opportunity to deepen
Slide 11: Exchanges Share in Short Term Market
Exchanges Share in Short Term Market Exchange Market and ST Market - % of Total Consumption – India Share of 30.2% 41.2% 55.0% exchanges in short-term 15.0% market 13.6% 12.9% 11.5% 11.5% 10.6% 10.5% 10.7% 10.7% 8.0% 7.4% 6.3% 6.8% 4.0% 4.2% 4.4% 3.2% 3.6% FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY2
Slide 12: Electricity Growth Drivers
Electricity Growth Drivers India is placed as the most promising economy on the global map 2,300 ➢ Industrialization 1,930 ✓ High GDP growth of about 7.5% expected to drive electricity 1,718 ✓ Core sector, traction, EV, cooking will drive electricity 1,622 1,506 consumption 1,374 1,2841,271 ➢ Rapid
Slide 13: In this presentation
In this presentation: Sector in Transition Electricity Value Chain IEX: Who We Are Indian Gas Exchange (IGX) International Carbon Exchange (ICX) Way Forward 12
Slide 14: India's Premier Technology-led Electricity Marketplace
India’s Premier Technology-led Electricity Marketplace ➢Nation wide, automated and transparent Robust Ecosystem trading platform for physical delivery of electricity, renewables & certificates 7,900+ 4,900+ 2,100+ ➢Commenced operations in 2008; CERC Registered Commercial & RE Generators & participan
Slide 15: Benefitting Power Sector….and the Nation
Benefitting Power Sector….and the Nation ➢ Provides benchmark prices for All Electricity Transactions ➢ Transparent Mechanism for Price Discovery ➢ High liquidity on Exchange has Ensured Lowest Cost and Assured Supply Truly Benefited Indian Power Sector Generation Transmission Distribution ➢ Lower P
Slide 16: Our Values
NIEX Our Values <Oy, 24X7 Power Transparency Flexibility in Power Procurement Competitive Price Payment Security Cost Saving 15
Slide 17: Market Segments
Market Segments Integrated Day Ahead Market Intraday Market & Contingency Market Segment DAM since Jun’08 Since Jul’15 Delivery for next day; 15 min. contracts, Daily trade Intraday Market : hourly and or 15-minute contracts on same Price discovery: Closed , Double-sided Auction day on rolling
Slide 18: IEX Product Mix
IEX Product Mix DAC H1 FY24 8% H2 FY24 Certificates DAC Certificates 6% 1% 9% TAM TAM 11% 7% DAM 46% DAM 51% RTM RTM 25% 30% Green Green 3% 3% Total Volume: 52 BU Total Volume: 58 BU ➢ Post implementation of GNA on 1st Oct 2023, shift in volumes from DAC market to the DAM. ➢ Volumes in DAC market in
Slide 19: No Fuel Crunch
No Fuel Crunch Indonesian 4200 GAR Coal Prices E-auction Prices above Notified Price (%) Coal Inventory at Power Plants 90 89 92 90 19 85 86 89 85 425 83 16 78 357 73 74 345 14 14 14 14 14 14 14 13 14 72 69 290 312 276 288 59 58 58 57 57 56 54 52 50 52 242 241 10 8 9 182 183 146 262 118 227 78 86 18
Slide 20: Policy Measures Amid Summer Peak Demand
Policy Measures Amid Summer Peak Demand Measure - 8 Measure - 7 • Shifting of hydro power Measure - 1 • Capacity additions in coal, generation to peak hours • Un-requisitioned/surplus hydro, nuclear, solar and wind power must be offered in to be monitored, to expedite power exchanges by all their co
Slide 21: Leading to Reduction in Exchange Prices
Leading to Reduction in Exchange Prices 11.0 10.1 IEX Price 10.0 9.0 9.6 8.0 6.8 6.9 6.7 7.0 6.5 6.5 6.2 6.2 6.9 5.8 6.0 6.6 5.6 6.5 5.4 5.4 5.4 5.4 5.2 5.2 6.1 5.9 5.9 4.9 4.6 5.7 4.7 4.6 5.0 4.5 5.5 5.1 5.0 4.7 4.8 4.8 3.8 4.7 4.9 4.9 4.9 3.9 4.7 3.9 4.0 4.6 4.5 4.0 3.9 3.8 3.0 2.0 DAM MCP (Rs./kW
Slide 22: Robust Financial Performance of IEX
Robust Financial Performance of IEX Consolidated Financials Rs Cr Breakup of standalone Q4FY23 FY23 Q4FY24 FY24 550.8 revenues (%) 474.1 478.6 409.5 350.8 305.9 Transaction Fees 79% 80% 78% 78% Admission and Annual 4% 4% 3% 4% Fees FY23 FY24 Total Revenue EBITDA PAT Other Income 16% 15% 19% 18% 129.
Slide 23: Customer Centric Technology and Product Strategy
Customer Centric Technology and Product Strategy CUSTOMER CENTRIC EFFICIENT STATE OF THE ART ➢ Digital Experience ➢ Automation ➢ National Open Access Registry ✓ Secure Web Access ✓ Auto Carry Forward of Uncleared Bids ✓ Integrated bids across segments ✓ Seamless DC-DR Transition to ensure ✓ Integrat
Slide 24: Creating Customer Delight for Each Interaction
Creating Customer Delight for Each Interaction ➢ Ease of Bidding ➢ Digital Registration Bidding ➢ Multiple Products ➢ Frictionless ➢ Efficient Price Discovery ➢ Quick Customer ➢ Data Insights Interactions ➢ Automated ➢ On-Time Payment ➢ Real-Time Communication ➢ Robust Risk Management Financial Sche
Slide 25: Transitioning Towards a Futuristic Tech Architecture
Transitioning Towards a Futuristic Tech Architecture Automated ➢ Digital Inside Manual Workflow ➢ Open API Integration Digital Mesh ➢ Automation Modular ➢ Service Oriented Architecture Monolithic ➢ Automated Bank Integration Digital Twins ➢ Web-based Portal Desktop-based All Platforms ➢ Power Market
Slide 26: IEX Initiatives
IEX Initiatives ✓ Launched in June to create pool of skilled professionals for capacity building in the power market. Nearly 300 enrollments across the sector. ✓ Certification courses to develop skills and expertise in Electricity Markets across topics such as power sector policies, regulatory frame
Slide 27: In this presentation
In this presentation: Sector in Transition Electricity Value Chain IEX: Who We Are Indian Gas Exchange (IGX) International Carbon Exchange (ICX) Way Forward 26
Slide 28: Indian Gas Exchange (IGX)
Indian Gas Exchange (IGX) VISION To lead India’s transition towards a gas-based economy by architecting next generation solutions for natural gas trading and access 01 1st Natural Gas trading exchange 02 Automated platform with cutting edge technology 03 Efficient & transparent market driven price d
Slide 29: IGX – Key Highlights
IGX – Key Highlights Q4 FY24 Business Updates Strategic Partners Total Volume 8.7 Million MMBtu Total number of trades 293 No. of members 44 Registered Clients 180+ Domestic Gas Ceiling Price ➢ Commenced trading on 23rd May’22 ➢ Total Traded Volume: Since May’22 – 100 Million MMBtu: FY’23 – 51.2 Mil
Slide 30: Key Updates/Achievements in FY24
Key Updates/Achievements in FY24 ✓ Power Sector – Gas Based Power Plants buying through IGX ✓ Fertilizer Sector – Fertilizer manufacturers allowed to buy domestic gas through IGX as a pilot ✓ DGH Empanelment – Domestic Producers can now auction their gas through IGX Platform ✓ Launch of small-scale
Slide 31: GIXI (Gas IndeX of India)
GIXI (Gas IndeX of India) Prices are volume weighted average price for all gas excluding domestic ceiling price gas GIXI represents prices for all hubs; for regional hubs will be named as GIXI West etc. For months, will be named as GIXI-Jan23 etc. Helps the market participants to know inland gas pri
Slide 32: Opportunity
Opportunity Growth in Gas Demand will lead to opportunities for Gas Exchange ➢ One Nation One Gas Grid by 2030 Going Forward ➢ Government’s vision of increasing share of Natural Gas in total energy basket from ➢ Introduction of Chhara ~6.3% to 15% by 2030 will increase gas consumption in the economy
Slide 33: Key Gas Market Enablers
Key Gas Market Enablers Inclusion of Natural Gas under GST Incorporation of TSO Implementation of New Access Code Regulations Declaration of CGD Exclusivity (Open Access within CGD Areas) Policy Steps to Accelerate Role of Natural Gas in India’s Economy (Natural Gas usage over polluting fuels) 32
Slide 34: In this presentation
In this presentation: Sector in Transition Electricity Value Chain IEX: Who We Are Indian Gas Exchange (IGX) International Carbon Exchange (ICX) Way Forward 33
Slide 35: International Carbon Exchange (ICX)
International Carbon Exchange (ICX) ➢ IEX formed a wholly owned subsidiary – ICX, in December 2022 to promote voluntary carbon market; second diversification initiative after successful launch of IGX in 2020. Ministry of ➢ Will help India achieve its target of reducing the emission intensity of its
Slide 36: In this presentation
In this presentation: Sector in Transition Electricity Value Chain IEX: Who We Are Indian Gas Exchange (IGX) International Carbon Exchange (ICX) Way Forward 35
Slide 37: IEX: Growth Drivers (1/5)
IEX: Growth Drivers (1/5) ➢ MoP amended Late Payment Surcharge Rules which mandates generators to offer URS power in the market. o Recovery of fixed charges linked to offer of URS – Failure to offer URS power on PXs implies un- requisitioned surplus power to the extent not offered on PXs up to the d
Slide 38: IEX: Growth Drivers (2/5)
IEX: Growth Drivers (2/5) ➢ CERC issued order on increasing frequency of REC auctions on power exchanges to twice a month and allowed fungibility of different type of RECs. Consequently, REC volume in Q4 FY’24 increased twice vis-à-vis Q4 FY’23 and will grow going forward. REC price also hit record
Slide 39: IEX: Growth Drivers (3/5)
IEX: Growth Drivers (3/5) ➢ Electricity consumption grew by 9% in FY’23; FY’24 higher by 7.7%; expected to further increase by Demand for 6% in next 7 years. Electricity ➢ CEA expects power demand to soar above 260GW in FY’25 ➢ Government highlights need for thermal capacity addition to meet increas
Slide 40: IEX: Growth Drivers (4/5)
IEX: Growth Drivers (4/5) ➢ RTM: June’20 ➢ Green Markets: GTAM launched in Aug’20, GDAM launched in Oct’21 Growth from ➢ Cross Border: April’21 recently ➢ Term Ahead Market Up to 3-Months in June’22 launched products ➢ HP-DAM (High Price-DAM): March’23 ➢ Ancillary Market launched: June’23 ➢ HP-TAM:
Slide 41: IEX: Growth Drivers (5/5) - Future Opportunities
IEX: Growth Drivers (5/5) - Future Opportunities Virtual PPA’s ➢ Financial instrument used by buyers/sellers to hedge electricity cost Contracts for Difference (CfDs) ➢ Buyer not obligated to undertake direct physical delivery of ➢ CfD model beneficial for RE generators, provides long-term electrici
Slide 42: Thank You
THANK YOU Phone: +91-120 4648100ꢀ Email: contact@iexindia.comꢀ Website: www.iexindia.com @IndianEnergy @IEX_India_ @indian-energy ExchangeLtdIEX -exchange-limited
Slide 43: IEX Announces Audited Financial Results for Q4 & FY2024
INDIAN ENERGY EXCHANGE (IEX) ANNOUNCES AUDITED FINANCIAL RESULTS FOR THE FOURTH QUARTER & YEAR ENDED MARCH 31, 2024 IEX CULMINATES FY‘24 WITH HIGHEST EVER TOTAL VOLUME OF 110 BU IN FY’24, INCREASE OF 14% YOY REVENUE FOR FY’24 AT INR 551 CRORE, UP 16% YOY. STANDALONE PAT FOR FY’24 AT INR 341 CR
Slide 44: Press release continuation: dividend and power sector
For fiscal year 2024, the Board of Directors of the Company announced a final dividend of Rs.1.50/- equivalent to 150% of the face value of equity shares. On the power sector front, according to government data, India’s electricity consumption in FY’24 reached 1,622 BUs, representing a 7.7% increase
Slide 45: Press release contacts
Ms. Aparna Garg Mr. Vineet Harlalka Head - Corporate Communications CFO & Company Secretary Telephone: +91-9958274392 Telephone: +91-120 - 4648100 Email: aparna.garg@iexindia.com Email: investorrelations@iexindia.com Indian Energy Exchange Ltd Registered Office: C/o Avanta Business Centre, First Flo
Indian Energy Exchange — Q4 FY2024 Earnings Presentation on 6ix