Adani Green Energy Limited · NSE:ADANIGREEN
Adani Green Energy — Investor Presentation (June 2019)
53 slides from Adani Green Energy's investor presentation, June 2019
Slide 1: Adani Green Energy Limited Investor Presentation
Adani Green Energy Limited Investor Presentation June 2019
Slide 2: Disclaimer
Disclaimer Certain statements made in this presentation may not be based on historical information or facts and may be “forward- looking statements,” including those relating to general business plans and strategy of Adani Green Energy Limited (“AGEL”),the future outlook and growth prospects, and fu
Slide 3: Contents
Contents 01 Adani Group 1A About Adani Group 02 Adani Green Energy 2A Industry Overview & Growth Drivers 2B Portfolio and Operational Details 2C Strategic Priorities 2D Management & Our Project Execution Capabilities 2E Financials & Financing Philosophy 2F Compelling Investment Opportunity A Appendi
Slide 4: 1. Adani Group
1.Adani Group STRICTLY CONFIDENTIAL
Slide 5: 1A. About Adani Group
1.Adani Group A. About Adani Group STRICTLY CONFIDENTIAL
Slide 6: Leading Infrastructure Conglomerate in India
Leading Infrastructure Conglomerate in India 4,560 MW Among Largest Renewable players in India Founded in 1988 by Mr Gautam Adani, Adani group has interests in power generation, coal 13,464 ckm Largest Private Transmission Player mining, trading, ports operations, logistics Sh Gautam Adani 208 MMT L
Slide 7: Case Study: AEL Value Creation ~30% CAGR over 25 Yrs
Case Study : AEL Value Creation ~ 30% CAGR over 25 Yrs After 2015 group IPO in Nov 1994 In 10 yrs from IPO In 20 yrs from IPO As on Date restructuring Adani Enterprises – 80 shares Adani Enterprises – 80 shares APSEZ – 113 shares Adani Enterprises – 1 Adani Enterprises – 40 shares Adani Enterprises
Slide 8: Track Record of Delivering World Class Assets
Track Record of Delivering World Class Assets Leveraging Core Strengths Delivering World Class Assets Mega project developed, constructed Large scale businesses delivering and commissioned in 9 months consistent growth 648 MW Ultra Mega Location: Kamuthi, Tamilnadu Solar Power Plant Solar Ir
Slide 9: Largest Integrated Energy Player in India
Largest Integrated Energy Player in India End to End Integration in the Energy Value Chain Coal Business Panel Thermal Power Renewables Solar Park Trans. & Distribution Manufacturing Largest importer 1.2 GW Installed capacity ~2 GW operational ~2GW 50:50 JV Owns & operates & trader of Co
Slide 10: 2. Adani Green Energy
2.Adani Green Energy STRICTLY CONFIDENTIAL
Slide 11: 2A. Industry Overview & Growth Drivers
2.Adani Green Energy A. Industry Overview & Growth Drivers STRICTLY CONFIDENTIAL
Slide 12: Industry Overview (1/2)
Industry Overview (1/2) India has significant headroom for power consumption growth Renewables’ overall share in power generation remains low2 Per capita power consumption 2016 (KWh)1 3% 10% US: ~11x India 9% 12,071 China: ~4x India Thermal World: ~2.3x India Renewable 7,481 6,602 Hydro 4,475 Nuclea
Slide 13: Industry Overview (2/2)
Industry Overview (2/2) Growth Drivers – India achieves Grid Parity – Solar Bids India’s Renewable Road Map1 CERC APPC - INR 3.60 / kwh for FY’20 2019 2022 3.30 3.15 25% CAGR 2.44 2.47 2.44 2.48 ~28GW 100 GW Solar Feb-17 Apr-17 May-17 Dec-17 Jul-18 Mar-19 ~36 GW 60 GW Wind Growth Drivers – India ach
Slide 14: Solar Sector – Paradigm Shift and Our Response
Solar Sector – Paradigm Shift and Our Response Past Dynamics of the sector What has changed today Solar penetration was only driven by RPO Technology and efficiency improvement, led to obligations… Solar was “Good to Have” decrease in module prices by > 60% Project Setup / Technology Higher pl
Slide 15: Wind Sector – Paradigm Shift and Our Response
Wind Sector – Paradigm Shift and Our Response Past Dynamics of the sector What has changed today FIT was largely based on data provided by OEMS From 2017, all new PPAs moved to bids, largely for their explored sites and existing WTG models based on ISTS substations pushing Tariff down FIT Tariff
Slide 16: Hybrid technology driving Round the Clock Solution
Hybrid technology driving Round the Clock Solution Key Considerations for Hybrid Solar and Wind Power Plants characteristically generate power at different intervals and during complementary seasons This helps to ensure that the level of energy being fed into the grid is steadier than that of Wi
Slide 17: 2B. Portfolio and Operational Details
2.Adani Green Energy B. Portfolio and Operational Details STRICTLY CONFIDENTIAL
Slide 18: Adani Green – Holding Structure
Adani Green – Holding Structure Holding Structure Details Demerged from AEL on 1st April 2018 Promoter Public Listed on 18th June 2018 Market Capitalization1 INR 6,733 Cr 80.90% 19.10% FY’19 Revenue2 – INR 2,131 cr Solar Wind Hybrid EBITDA – INR 1,710 cr # SPVs 15 # SPVs 8 # SPVs 1 Assets – IN
Slide 19: Pan India Portfolio
Pan India Portfolio Revenue Split by Counterparties Punjab Operational Full Portfolio 100 Uttar Pradesh 10% Rajasthan 19% 640 20 34% 275 Gujarat 51% 1,325 60 26% 12 51% 5% 4% NTPC SECI A & above B+ & below 100 Maharashtra 20 100 50 Karnataka 810 Tamil Nadu Locations 648 Operational Particulars Solar
Slide 20: Development Risk Profile improving
Development Risk Profile improving Additional Future Projects + Operational UC 4,560 4,560 1,790 2,590 2,570 2,000 612 4,560 1,192 2,770 798 1,958 1,970 485 808 313 FY16 FY17 FY18 FY19 FY20E FY21E In the forecast period given above, AGEL is also planning investments in international markets, primari
Slide 21: Operational Performance
Operational Performance Average Capacity (MW AC) PLF % (AC) Solar Wind Solar Wind 1,898 1,898 1,744 29.81% 30.96% 25.89% 22.35% 21.66% 21.14% 18.55% 18.25% 21.68% 858 19.69% 20.08% 20.02% 648 648 668 16.36% 13.87% 13.53% 8.33% 60 60 60 60 60 60 72 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Q2 & Q3 FY19
Slide 22: 1.9 GW Solar Portfolio Operational Bridge
1.9 GW Solar Portfolio Operational Bridge Actual to Technical Estimates* Estimated Quarterly CUF for 1.9 GWAC Portfolio March’19 Target CUF Achieved CUF 33.00% 28.64% 28.00% 23.68% 24.22% 21.56% 23.00% 25.89% 18.00% 21.68% 21.66% 20.08% Q1FY'19 Q2FY'19 Q3FY'19 Q4FY'19 FY’19 AGEL has almost achieved
Slide 23: 2C. Strategic Priorities
2.Adani Green Energy C. Strategic Priorities STRICTLY CONFIDENTIAL
Slide 24: AGEL's Strategic Priorities
AGEL’s Strategic Priorities Growth and Vision to be one of the leading Global renewable players Returns Focus Disciplined investment decisions framework to add incremental shareholder value Optimal Leverage internal accruals to drive RoE with accretive growth Capital Management Established p
Slide 25: Profitable growth leading to superior returns
Profitable growth leading to superior returns Completed / Average Expected Project Capacity Revenue^ EBITDA$ Tariff Cost# Capex / EBITDA (in MW) (in Rs Cr) (in Rs Cr) (in Rs/kWh) (in Rs Cr) Operational * Solar 1,948 5.07 12,844 2,184 2,092 6.14 Wind 72 4.06 455.00 79 72.56 6.27 Total 2,020 5.04 13,2
Slide 26: Solar bids won FY 2019: Cautious approach
Solar bids won FY 2019: Cautious approach Capacity Difference in Capacity Won offered by Tariff offered L1 Bid Tariff tariff offered by AGEL Tender Location AGEL by AGEL Successful (Rs/KWh) & L1 (Rs/KWh) (MW) (in paise/unit) (MW) 500MW-Solar Projects GJ 150 2.67 Yes 2.55 12 150 Phase-IV - GUVNL 2000
Slide 27: 2D. Management & Project Execution Capabilities
2.Adani Green Energy D. Management & Project Execution Capabilities STRICTLY CONFIDENTIAL
Slide 28: Strong sponsor & professional management with strong execution track-record
Strong sponsor & professional management with strong execution track-record Professional Management Team Jayant Parimal Ashish Garg Rajesh Shrivatsava CEO CFO COO - Projects Mr. Jayant Parimal has been associated with Mr. Ashish Garg has been with AGEL Mr. Rajesh recently joined the group the
Slide 29: Project Execution – Key Strengths
Project Execution – Key Strengths •Leverage experience of dealing land & other statutory permissions from other similar business activities such as Transmission & Real estate Land •Identifying strategic land near substation to reduce cost of transmission line Acquisition •Strong In-house design team
Slide 30: Development Pipeline – Key Differentiating Factor for AGEL
Development Pipeline– Key Differentiating Factor for AGEL 20 GW Development Pipeline in Resource Rich areas Expected Wind growth is supported by ~5 GW of wind sites under self development Land applied for 75% of identified area. ‒ Ready sites to house Transmission Connectivity available for 1.8 GW f
Slide 31: Source highest quality equipment from reputed OEMs
Source highest quality equipment from reputed OEMs Solar Modules Inverters and Trackers Best Vendors : Resilient and reliable supply from Tier-1 vendors, Inverters strategic relationship with 6 Super League Based on technological advancement and economic viability used No Technology Risk : Pro
Slide 32: Our O&M Philosophy
Our O&M Philosophy Cluster based operating model to ensure adequate support and governance at each site Operational Optimized module cleaning cycle by comparing revenue loss due to soiling against the cost of module cleaning Strategy Maintenance and Operational Excellence based on real time da
Slide 33: RONC – World Class Monitoring and Analytics
RONC – World Class Monitoring and Analytics RONC (Remote Operations Nerve Center) RONC Benefits RONC Operational Flow Ability to manage large Centralization of overall management of all Centralized number of sites Adani sites from a single location Support increasingly Site(s) Level Data Captu
Slide 34: 2E. Financials & Financing Philosophy
2.Adani Green Energy E. Financials & Financing Philosophy STRICTLY CONFIDENTIAL
Slide 35: Robust financial performance driven by fully contracted cash flows
Robust financial performance driven by fully contracted cash flows Revenue (Rs Cr.)1 EBITDA7 (Rs Cr) and margin5 (%) Cash Profit6 (Rs. Cr) +39% 2,058 792 1,710 +105% 1,480 +75% 452 834 90% 86% FY18 FY19 FY18 FY19 FY18 FY19 Investment in CAPEX (gross) Net external debt2 and Shareholders’ Net External
Slide 36: Revenue, EBITDA & Net External Debt bridge Y-o-Y
Revenue, EBITDA & Net External Debt bridge Y-o-Y Revenue from Power Supply EBITDA Net External Debt 35
Slide 37: Financial Summary – Income Statement
Financial Summary – Income Statement Particulars (INR Cr) Q4’19 Q4’18 FY19 FY18 Revenue from Operation 681 406 2058 1480 Other income 38 11 73 39 Total Revenue 719 417 2131 1519 Cost of material consumed and others 130 109 130 514 Operational & Maintenance expenses 81 49 218 132 Finance Costs 274 14
Slide 38: Financial Summary – Balance Sheet
Financial Summary – Balance Sheet Particulars (INR cr) FY19 FY18 Assets Non Current Assets Fixed Assets: Gross Block 12,331 9,996 Less :-Accumulated Depreciation (1,943) 876 Net Block 10,388 9,120 Capital work-in-progress 743 1,725 Financial Assets 507 453 Deferred Tax Assets 376 246 Other Non Curre
Slide 39: Capital Structure as enabler for growth
Capital Structure as enabler for growth Efficient refinancing to unlock cash flows Debt Philosophy for growth 100% Pool with NTPC – 370 MW (40%) Project debt self-amortizing before end of contracted life SECI – 160 MW (17%) diversified State DISCOMs with A rated or more – 160 Counterparty MW (
Slide 40: 2F. Compelling Investment Opportunity
2.Adani Green Energy F. Compelling Investment Opportunity STRICTLY CONFIDENTIAL
Slide 41: AGEL: A Compelling Investment Opportunity
AGEL: A Compelling Investment Opportunity Adani group is a leader in infrastructure –ports, T&D, thermal power and renewables 1. Infrastructure lineage Proven track record of excellence in development & construction India plans to grow renewables from 75GW to 175GW in next few years 2. Signifi
Slide 42: Thank You
Thank You STRICTLY CONFIDENTIAL
Slide 43: Appendix: List of Annexures
APPENDIX List of Annexures STRICTLY CONFIDENTIAL
Slide 44: Asset Level Details – Operational
Wind Projects Solar Asset Level Details – Operational* Hybrid SPV Project Name / Location Type Capacity (AC) Tariff COD Counterparty Name Credit Rating Term AGETNL Solar 216 7.01 Mar-16 TANGEDCO ICRA (B) 25 RSPL Solar 72 7.01 Feb-16 TANGEDCO ICRA (B) 25 AGETNL KREL Solar 72 5.761&2 Mar-16 TANGEDCO I
Slide 45: Asset Level Details – Under Construction
Wind Projects Asset Level Details – Under Construction Solar Hybrid Project Name / SPV Type Capacity (AC) Tariff COD Counterparty Location Name Credit Rating Term ARERJL Rajasthan Solar 200 2.71 Aug-19 MSEDCL ICRA (B+) 25 AGEONEL Gujarat Solar 150 2.67 Nov-20 GUVNL ICRA (A+) 25 GSBPL Gujarat Solar 1
Slide 46: AGEL: International Opportunities
AGEL: International Opportunities Vietnam Vietnam Project Name MIDLAND HARTSEL HUNTER SIGURD US Total Solar Wind Project Capacity 72.1 72 100 80 324.1 38.1 MWac 27.2 MW (MWac) South Location Colorado Utah Utah Ninh Thuan Province Carolina Expected Project Jul-20 Dec-22 Dec-20 Dec-20 Dec-20 Dec-20 Co
Slide 47: India's Grid Infrastructure will be able to Integrate the Targeted 175GW of Renewable Capacity
Adani Green Energy India’s Grid Infrastructure will be able to Integrate the Targeted 175GW of Renewable Capacity STRICTLY CONFIDENTIAL
Slide 48: Proposed grid addition to absorb upcoming renewable capacity
Proposed grid addition to absorb upcoming renewable capacity Proposed CTU for 50 GW of incremental Solar 25 Additional CTU Phase I-upto Dec 20 Additional CTU Phase II-upto Dec 21 20 15 10 10 6 5 10 2.5 5 4 2.5 2.5 4 2.5 0 1 RJ AP 0 KA GJ MH MP Proposed CTU for 16.5 GW incremental Wind 8 Additional C
Slide 49: Scenario with Integration of 175 GW Renewable power
Scenario with Integration of 175 GW Renewable power (by FY 2021-22) Central Electricity Authority (CEA) recently conducted a study, and demonstrated that it is feasible to integrate the new renewable capacity, with various options Inter-Regional power flow during Peak demand (FY 2022) • WR and ER wi
Slide 50: Integration of 175 GW Renewable power – Option 1
Integration of 175 GW Renewable power - Without any burden on exchequer (Option 1) Grid balancing with Flexible Operation Step 1 - Reallocation of Hydro and Gas plant generation to peak hours Step 2 - Flexible power from Battery Storage Step 3 - Curtailment of Renewable Energy Source Minimum Thermal
Slide 51: Integration of 175 GW Renewable power – Option 2
Integration of 175 GW Renewable power - With additional compensation to Thermal power plants (Option 2) Grid balancing with Flexible Operation of Thermal Power plant without RE curtailment Flexible operation of Thermal power plant below technical minimum will lead to following: 1. Increase in Net He
Slide 52: Current Solar PV Technology allows plant life well beyond the PPA life of 25 years
Adani Green Energy Current Solar PV Technology allows plant life well beyond the PPA life of 25 years STRICTLY CONFIDENTIAL
Slide 53: Solar PV modules have a life well beyond the PPA life
Solar PV modules have a life well beyond the PPA life of 25 years What is Module Degradation? Light Induced Degradation (LID), permanently degrades Year of installed life $ modules starting from the first ray of solar radiation and 70 extends further up to six months 60 Annual Degradation – Effi
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