Adani Energy Solutions Ltd · NSE:ADANIENSOL
Adani Energy Solutions — Adani Electricity Mumbai — Investor Presentation (October 2020)
45 slides from Adani Energy Solutions's investor presentation, October 2020
Slide 1: Adani Electricity Mumbai Limited Investor Presentation
Adani Electricity Mumbai Limited Investor Presentation October 2020
Slide 2: Contents
Contents 01 Adani Group Overview 3-5 02 AEML – Business Overview 8-9 03 Regulatory and Operating Framework 11-14 04 Business Lever – Capex driven Growth in RAB 16-17 05 Capital Management Program and Investment Case 19-20 06 Annexure 23-41 STRICTLY CONFIDENTIAL
Slide 3: Adani Group Overview
01 Adani Group Overview STRICTLY CONFIDENTIAL
Slide 4: Adani Group: A world class infrastructure & utility portfolio
Adani Group: A world class infrastructure & utility portfolio Adani Adani Transport & Logistics Energy & Utility Portfolio Portfolio • Marked shift from B2B to B2C businesses – 63.5% 100% 75% 75% • AGL – Gas distribution network to serve key APSEZ SRCPL ATL AGEL geographies across Port & Logistics R
Slide 5: Adani Group: Repeatable, robust & proven model of infrastructure development
Adani Group: Repeatable, robust & proven model of infrastructure development Phase Development Operations Post Operations Origination Site Development Construction Operation Capital Mgmt Analysis & Site acquisition Engineering & Life cycle O&M Redesigning the market design planning capital structure
Slide 6: Adani Group: Repeatable, robust business model applied to drive value
Adani Group: Repeatable, robust business model applied to drive value Successfully applied across Infrastructure & utility platform Development at large scale & within time and budget India’s Largest Longest Private HVDC 6 4 8 MW Ultra Mega Largest Single Location Commercial Port Line in Asia Solar
Slide 7: AEML – Emulating Group Philosophy
AEML – Emulating Group Philosophy 6,575 substations2 Large scale Over 3.05mn households 24,638 km cable2 1,964 MW Peak Demand3 Integrated electric ~12mn consumers 566 ckt km Transmission 10,335 MUs Consumption3 utility network2 Committed to Green Initiatives 99.99% supply reliability3 Committed to p
Slide 8: AEML – Business Overview
02 AEML – Business Overview STRICTLY CONFIDENTIAL
Slide 9: AEML – Structure and Asset Description
AEML – Structure and Asset Description Adani Transmission Qatar Investment Limited Authority 25.1% 25.1% 100% 100% 100% 74.9% TBCB SPVs MEGPTCL ATIL AEML PDSL (U/C and Operational) Section 62: ROA Transmission Section 63 - TBCB Section 62: ROA Integrated Utility Services Utility Brief Asset Descript
Slide 10: AEML serves as the largest utility in the gateway city of Mumbai
AEML serves as the largest utility in the “gateway” city of Mumbai Servicing 85% of Mumbai’s geography, touching 2 out of 3 households in Mumbai BHAYANDER CREEK Key Characteristics of Mumbai THANE – India’s commercial capital and most populous city MIRA BHAYANDER – Among top 10 Global Finance Center
Slide 11: AEML – Regulatory and Operating Framework
03 AEML – Regulatory and Operating Framework STRICTLY CONFIDENTIAL
Slide 12: Business operating in a well-defined and mature regulatory framework
Business operating in a well-defined and mature regulatory framework… Section 62 of Electricity Act 2003 • Ensures Tariff determination based on Aggregate Revenue Requirement (ARR) • EBITDA in the ARR is related with RAB of the Company • Any reduction in the sales volume is allowed to be recovered t
Slide 13: …with a predictable EBITDA and stable return profile
…with a predictable EBITDA and stable return profile 14% - Base ROE Generation and Transmission business ROE 1.5% - linked to specific performance parameters 15.50% 15.50% 15.50% 14.00% 2007-12 2013-16 2017-20 2021-25 14% - Base ROE Wires business ROE 1.5% - linked to specific performance parameters
Slide 14: Currently Pursuing Operating Philosophy of Asset Hardening
Currently Pursuing Operating Philosophy of Asset Hardening… AEML ensuring highest quality of supply underpinned by 3 pillars SUSTAINABILITY RELIABILITY AFFORDABILITY AEML is committed to increasing share of Reliability of supply ensured by continuous AEML aims to maintain affordable tariff for renew
Slide 15: …with minimal impact on consumer tariffs
…with minimal impact on consumer tariffs We are committed to maintaining affordable tariffs while ensuring high quality of supply Average Billing Rate (ABR) - INR /unit1 Real ABR computed @ 5% Inflation rate Nominal ABR Real ABR 9.4 9.6 9.8 10.0 8.5 8.7 8.9 9.2 7.7 8.2 8.2 7.7 7.8 7.4 7.3 7.2 7.0 6.
Slide 16: Consumer-centricity to continue to appease customers and enhance stickiness
Consumer-centricity to continue to appease customers and enhance stickiness Customer Service Reach Multiple Customer 24X7 Contact Center Self-help service via Mobile Care Centers (Voice, Missed-call, Email) app, Whatsapp & Chat-Bot Service Delivery Tools Campaign Management and Outage Management Sys
Slide 17: Business Lever – Capex driven Growth in RAB
04 Business Lever – Capex driven Growth in RAB STRICTLY CONFIDENTIAL
Slide 18: Planned capex outlay of ~INR 16,603 cr from FY20-30
Based on complete future roadmap, AEML has a planned capex outlay of ~ INR 16,603 cr from FY20-30 In addition to wires and retail capex, plan is to enhance reliability of supply and upgrade the network 1,962 2,030 1,933 1,794 1,628 1,586 1,217 1,242 1,051 1,272 1,281 1,153 1,173 1,025 1,003 1,111 1,
Slide 19: Past trend of MERC suggests capex in line with DPR process is approved
Past trend of MERC suggests that capex done in line with DPR process is approved in true up / MTR Historically, MERC has approved a lower number in its MTR order and finally matches the actual capitalization executed by AEML during its final order for that year Amount in INR cr FY19 FY20 1 2 Action
Slide 20: Capital Management Program and Investment Case
05 Capital Management Program and Investment Case STRICTLY CONFIDENTIAL
Slide 21: AEML - Capital Management Program
AEML - Capital Management Program Value unlocking and Capital De-risking Fully-funded Growth Deleveraging AEML US$ 1bn bond issuance QIA’s acquisition of 25.1% Rolling capex facility of stake in AEML for Rs. 32 bn $400mn fully suffice capex (bullet maturity and tenor investment plan for next 10 year
Slide 22: AEML – Compelling Investment Opportunity
AEML – Compelling Investment Opportunity Stable and Rate of Return asset with stable Cashflow and EBITDA profile Predictable ~ 93 years of operating history, part of growth journey of Mumbai Cashflow ~ 20 years operating history of MERC – proven track record as a regulatory authority Stable Regulato
Slide 23: Appendix
A Appendix STRICTLY CONFIDENTIAL
Slide 24: AEML – Detailed Overview
01 AEML – Detailed Overview STRICTLY CONFIDENTIAL
Slide 25: AEML – Regulated Utility
AEML – Regulated Utility Operating in Gateway City of Mumbai Stable and Evolved Regulatory Regime Top 10 Centers of commerce in world AEML witnessed regulations since 1956 of regulatory orders under 6% of India’s real GDP 17 yrs current Electricity Act 2003 4x Per capita income of India MERC focus o
Slide 26: AEML – Asset Details
AEML – Asset Details Division Capacity License Key Characteristics Performance Generation • 2 x 250MW PPA till • 100% FGD installed Plant Availability % 2023 • 100% Washed Coal 14.5% 9.2% 9.9% 6.3% 85.0% 85.0% 85.0% 85.0% FY17 FY18 FY19 FY20 Transmission • 566 ckms Aug 15, • Part of Maharashtra Tran
Slide 27: AEML – EBITDA Components
AEML – EBITDA Components AEML Business comprises of regulated integrated utility with RAB of USD 826 mn* & unregulated business ATL PDSL Other SPVs AEML (Services) REGULATED INTEGRATED UTILITY GENERATION TRANSMISSION WIRES RETAIL Mar ’20 107 163 530 26 RAB $mn Mar ’20 37 33 168 8 EBITDA $mn % - EBIT
Slide 28: AEML benchmarks best O&M practices of international utilities
AEML continuously benchmarks the best O&M practices of international utilities serving gateway cities AEML is benchmarking itself against international utilities to further enhance its supply reliability Service Type Peer 1 Peer 2 Peer 3 Key Characteristics Area (sq. km.) 400 6,734 524,110 129,500 C
Slide 29: AEML – Technology and Consumer Centricity at the core of operations
02 AEML – Technology and Consumer Centricity at the core of operations STRICTLY CONFIDENTIAL
Slide 30: AEML has pioneered adoption of ground breaking technologies since inception
AEML has pioneered adoption of ground breaking technologies since inception These technological advancements have helped AEML create robust systems and processes infrastructure 1st utility in Smart Substation Introduced SAP, ISU CCS go-live Mumbai to go India’s 1st utility to chat/voice bots G
Slide 31: Mumbai network design significantly minimizes disruptions from grid disturbances
Mumbai network design significantly minimizes disruptions from grid disturbances Mumbai’s embedded generation of 1,800 MW ensures supply to all critical infrastructure of the city – Mumbai’s embedded generation of 1,800 MW (AEML’s Dahanu of 500 MW & Tata’s Trombay + Hydro plants 1,300 MW) ensures su
Slide 32: AEML employs an integrated system approach with GIS at the core
AEML employs an integrated system approach with the GIS system at the “core” This integrated O&M architecture helps ensure high supply reliability Workflow SCADA / DMS Management Faults noted in SCADA can Workflow Optimization for be located using GIS faster issue resolution GIS Outage Related Probl
Slide 33: Supply reliability supported by efficient operations at Dahanu
Supply reliability supported by efficient operations of embedded generation at Dahanu Dahanu has enabled supply reliability through adoption of best-in-class practices International and National awards > 100% PLF 7 consecutive years, 9 years in total > 100 awards for excellence in various fields1 >
Slide 34: AEML efficiently serving ~12 mn consumers of Mumbai
AEML efficiently serving ~12 mn consumers of Mumbai 1. Consumer Service Initiatives 2. Quality of Supply – Concessional tariff during religious festivals / – 99.99% supply reliability community prayers and for BPL consumers – 7.37% distribution losses in FY20 (compared to throughout year India’s nat
Slide 35: Adapting global best practices with consumer centricity
With Consumer Centricity at the heart, AEML continues to adapt global best practices AEML is benchmarking itself against international utilities for bettering consumer responsiveness Service Type Peer 1 Peer 2 Peer 3 Self Help Missed Call 1 Real Time tracking of Consumption WhatsApp Services Mobile
Slide 36: Planned capex schemes to cater to increased demand and maintain reliability
AEML has planned various capex schemes to cater to increased demand and maintain supply reliability AEML is undertaking capex under various schemes to strengthen network infrastructure 2020-30 Advanced Metering Real time load management Smart Metering scheme for Infrastructure to provide for Retail
Slide 37: ESG embedded in our operations
03 ESG embedded in our operations STRICTLY CONFIDENTIAL
Slide 38: AEML operating with a high focus on sustainability
AEML operating with a high focus on sustainability Renewable Power Climate Awareness Targeted 30% of consumption from Renewable sources Environmentally compliant generation at ADTPS Committed to increasing share of renewable power procurement from current 3% to 30% by 2023 and 50% by 2025 100% Fly
Slide 39: AEML’s initiatives towards reduction of carbon footprint
AEML’s initiatives towards reduction of carbon footprint Renewable energy procurement by AEML to leapfrog by 10X by FY22 Current More than 275 MUs of renewable energy procured (~ 3% of total energy procured) AEML has signed a hybrid (solar + wind) 700 MW PPA with minimum guaranteed CUF of 50%.
Slide 40: Safety is at the core of our philosophy
Safety is at the core of our philosophy AEML goes beyond mandated norms to ensure highest standards of safety for consumers 239 172 186 193 134 150 69 79 Consumer @ AEML 31 23 17 23 13 Consumer @ Home 7 network 47 28 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 Conduct of Electrical Safety Awareness am
Slide 41: AEML believes in serving the community through its social initiatives
AEML believes in serving the community through its social initiatives We strive to enrich the lives of the community we serve by various social initiatives At Adani Group, we strive to enrich the lives of the community through Adani Foundation Besides those, AEML has taken the following initiatives
Slide 42: AEML – Financial Summary
04 AEML – Financial Summary STRICTLY CONFIDENTIAL
Slide 43: Financial Summary - AEML
Financial Summary - AEML Profit and Loss Summary (all amounts in USD mn) As on March 31, 2020 As on September 30, 2019 Revenue 1,050 576 Total Income 1,050 576 Less: Cost of Power Purchased 415 203 Less: Cost of Fuel 167 79 Less: Transmission Charges 55 28 Less: Employee Benefit Expeneses 122 66 Les
Slide 44: Legal Disclaimer
Legal Disclaimer The information contained in this presentation is provided by Adani Transmission Limited (together with its subsidiaries, the “Company” or “ATL”) to you solely for your reference and for information purposes only. This presentation is highly confidential and is being given solely fo
Slide 45: Thank you
Thank you adani
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