Adani Energy Solutions Ltd · NSE:ADANIENSOL
Adani Energy Solutions — Debt Investor Presentation (November 2024)
54 slides from Adani Energy Solutions's debt investor presentation, November 2024
Slide 1: Adani Energy Solutions Limited Credit Presentation
Adani Energy Solutions Limited (Formerly known as Adani Transmission Limited) Credit Presentation November 2024
Slide 2: Contents
CONTENTS 04-07 Adani Portfolio 09-11 About AESL 13-14 Transmission 16-18 Distribution 20-21 Smart Metering 23-24 Cooling Solutions Opportunity Set and Business 26-32 Philosophy ESG Framework, Investment Case 34-39 and Board & Management 41-53 Annexure
Slide 3: Adani Portfolio
adani Energy Solutions Adani Portfolio
Slide 4: Adani: A World Class Infrastructure & Utility Portfolio
Adani: A World Class Infrastructure & Utility Portfolio Flagship Infrastructure & Utility Core Portfolio Primary Industry Emerging B2C Materials, Metal Direct to Incubator Energy & Utility Transport & Logistics & Mining consumer (100%) (100%) (74.89%) (100%) (50.00%) (100%) (100%) ANIL AdaniConneX3
Slide 5: Adani Portfolio: Decades long track record of industry best growth
Adani Portfolio: Decades long track record of industry best growth with national footprint Secular growth with world leading efficiency National footprint with deep coverage Growth 3x 6 Growth 4x 6 EBITDA 71% 1,2,3 EBITDA 92% 1,3,4 AEL APSEZ Growth 3x 6 Growth 1.4x 6 AGEL ATGL Adani’s Core Infra. Pl
Slide 6: Adani: Repeatable, robust & proven transformative model of investment
Adani: Repeatable, robust & proven transformative model of investment DEVELOPMENT OPERATIONS CONSUMERS 1 New C.E.O. Adani Infra (India) Limited (AIIL) Operations (AIMSL) Consumer I Employees I Other Stakeholders Origination Site Development Construction Operation Inspired Purpose & Value Creation AC
Slide 7: AESL: A platform well-positioned to leverage growth opportunities in energy domain
AESL: A platform well-positioned to leverage growth opportunities in energy domain RAB expansion through Execution Prowess Strategic Presence Asset Hardening in Discoms Transmission Network of Transmission - Presence in 14 states 7% CAGR growth in RAB in Mumbai Development 24,084 ckm(1) Distribution
Slide 8: About AESL
adani Energy Solutions Adani Energy Solutions Ltd. (formerly known as Adani Transmission Ltd.) adani Energy Solutions =i, Smart Metering About AESL
Slide 9: AESL: Business Snapshot
AESL: Business Snapshot Adani Family Public 69.9%(1) 30.1% Transmission Distribution Smart Metering Cooling Solutions 100% 25.1%(2) 74.9% 100% 100% 100% 100% AEML MUL 22.8 million smart meters with a Section 63 Section 62 Mundra Parallel License (under approval): Mumbai contract value of Rs. 272 bil
Slide 10: Transformational Journey with Robust Growth and Credit Discipline
Transformational Journey with Robust Growth and Credit Discipline EBITDA (Rs. Crs) 6,322 6,101 5,493 5,066 4,519 2,937 3,113 1,997 2,005 FY16 FY17 FY18# FY19 FY20 FY21 FY22 FY23 FY24 Transmission Distribution AESL is Investment grade rated since FY16 Net Debt to EBITDA(2) (x) Gross Fixed Assets(3) (
Slide 11: AESL and AEML Credit Ratings
AESL and AEML Credit Ratings International – ATSOL Obligor Group (Transmission business) (Reg S/ 144A) SPV Ratings - Domestic Rating Agency Facility Rating/Outlook Company Rating Agency Rating Outlook AESL India Ratings AA+ Stable Fitch Dollar Bond BBB-/Stable AESL ICRA A1+ Stable Moody’s Dollar Bon
Slide 12: Transmission
Energy Solutions
Slide 13: Transmission Business
Transmission Business Transmission Section 63 Section 62 Key Characteristics (Fixed tariff1) (RAB Assets) Concession Life : 35 years 35 Transmission Assets 7 Transmission Assets Counterparty : Network pool (Centre and State) 11 Under-construction 24 Operating Assets 5 Operating Assets 2 Under-constr
Slide 14: Asset Portfolio: Presence Across the Country
Asset Portfolio: Presence Across the Country 16 ~24,084 ~75,186 States ckt km MVA MUL (85 sq km) (distinct states Transmission Transmission including smart metering business) Line Capacity No Operational Ckt Kms 24 MUL 242 Khavda RE 1 MEGPTCL 1,217 25 WKTL 1,756 Cluster 2 ATIL (3 lines) 3,834 26 KTL
Slide 15: Transmission: Private Participants Opportunity of ~US$ 28 bn over 10 years
Transmission: Private Participants Opportunity of ~US$ 28 bn over 10 years Attractive Industry Opportunity backed by strong policy support RE penetration & General Network Access to boost system strengthening – Mandatory competitive bidding introduced since 2006 (TBCB) Renewable Penetration General
Slide 16: Distribution
Adani Energy Solutions Limited Debt Presentation | February 2 0 2 0 Transmission Distribution 14
Slide 17: Distribution Business
Distribution Business Distribution Section 62 (RAB Assets) AEML MUL Parallel Licensing Key Characteristics (applied and proposed) Mumbai Mundra SEZ License period: 25-year and perpetual business 400 sq km license area 85 sq km license area • Mundra Subdistrict • Navi Mumbai & Thane Regulated Asset B
Slide 18: AEML Distribution: India's No. 1 power utility
AEML Distribution: India's No. 1 power utility, as per MoP, McKinsey, PFC (Scored 99.6/100) Largest Integrated utility in India’s Commercial Capital - Mumbai AEML – Key Milestones Since Acquisition Approved RAB Addition and EBITDA (Rs Crs) Capitalised RAB (Rs Crs) About Mumbai RAB addition (Capex) E
Slide 19: MPSEZ Utilities Limited (MUL): Overview
MPSEZ Utilities Limited (MUL): Overview Mundra SEZ is strategically located with well developed supporting RAB(1) (Rs Cr) infrastructure serving as an attractive industrial hub – Electricity Distribution for Mundra SEZ area 55%, RAB FY24 28 45%, 23 Rs 50 Cr – Catering primarily to commercial and ind
Slide 20: Distribution and Parallel License Opportunity
Distribution and Parallel License Opportunity – Power distribution is one of the largest consumer facing sectors in the country. 96.7% of ~270 mn households(1) in India are connected to the grid and primarily owned and operated by state governments – AESL’s Distribution platform intends to position
Slide 21: Smart Metering
adani Energy Solutions Smart Metering
Slide 22: Smart Metering Business
Smart Metering Business Smart Metering Key Characteristics DBFOOT (Totex Model) Payment Security through Direct Capex + Opex Contract period: 10 Years debit facility Under Implementation Counterparty: Pool of over 91 million Enhanced energy efficiency and RE consumers integration 9 Contracts (22.8 M
Slide 23: Smart Metering Contractual Framework
Smart Metering Contractual Framework Flow of Revenue for Smart Meter SPV Contract For Advanced Metering Infrastructure Service Provider (AMISP) Payment of Electricity Bills Consumers Payment Gateway Agent Bank Month Months 0 120 Supply of Direct Debit Facility Implementation Period Operational Perio
Slide 24: Smart Metering Opportunity
Smart Metering Opportunity – Awarded (LOA) and Negotiation (L1) stage: 157 Mn Smart Meters – Untapped market: 93 Mn Smart meters India’s Target (mn meters) AESL’s Market Share (mn and %) Punjab Uttarakhand Haryana Rajasthan Assam Bihar 23 / Tripura 17% Gujarat Madhya Pradesh West Bengal 141 133 Maha
Slide 25: Cooling Solutions
Cooling Solutions 25 Picture source: GIFT City DC Plant
Slide 26: Cooling Solutions: DSC Snapshot
Cooling Solutions: DSC Snapshot The District Cooling System (DCS) produces chilled water in a central plant and distributes cooling capacity in the form of chilled water from the central plant to multiple buildings through a network of underground pipes for use in space and process cooling. 1 A cent
Slide 27: Why District Cooling? – Business Rationale
Why District Cooling? – Business Rationale − Large scale infrastructure development requires sustainable, energy efficient and low carbon cooling solutions Changing Demographic and − Rising per capita income, urbanization, coupled with growing AC ownership to drive the cooling growth Economic Trends
Slide 28: Cooling Solutions Opportunity: Four key segments to drive DCS demand
Cooling Solutions Opportunity: Four key segments to drive DCS demand Cumulative Cooling Demand from key segments by FY30(1) (in Mn TR) Commercial Real To experience growth from 0.6 bn sqft (2019) 16% 84% 44.04 Estate to 1 bn sqft (2030) Global industrial cooling market, expected to 2.66 Industrial C
Slide 29: Business Philosophy
adan Energy Solutions Business Philosophy
Slide 30: Business Philosophy focusing on De-risking at every stage of project lifecycle
Business Philosophy focusing on De-risking at every stage of project lifecycle DE-RISKING AT EVERY STAGE Route Identification & Survey Project Execution − Complex projects experience: Completed HVDC project − Route alignment on topographic maps to optimize route & (~1000 kms) in a record time of 24
Slide 31: Project Management & Assurance Group (PMAG): End to End Project Integration
Project Management & Assurance Group (PMAG): End to End Project Integration Bidding, Site Scouting Project Development & Basic Engineering Execution Operations Concept Integrated Project Management Commissioning Strength: Team of 90 professionals having hands-on experience of 2,000+ man-years of com
Slide 32: Capital Management Philosophy to achieve growth at scale with capital discipline
Capital Management Philosophy to achieve growth at scale with capital discipline AESL is the only private sector transmission and distribution company in India with International IG Rating – Long life contracted assets with sovereign counterparties in a stable regulatory regime (Transmission: 35-yea
Slide 33: ESG Framework, Investment Case and Board and Management
ESG Framework, Investment Case and Board and Management 33
Slide 34: Assurance backed ESG framework
Assurance backed ESG framework Guiding principles IFC E&S United Nations UN Sustainable India Business & Biodiversity SLB Performance Global Compact Development Goals Initiative (IBBI) Principles Standards Guiding Policies principle Disclosure Standards TCFD TNFD GRI Standards CDP disclosure BRSR GH
Slide 35: Transforming through Green Energy Adoption
Transforming through Green Energy Adoption − AESL's pledge to ‘Net Zero by 2050’ to limiting the global temperature rise to 1.5°C with no or limited temperature overshoot. − With interim ABSOLUTE GHG emissions targets: • Reduce 72.7% Scope (1 + 2) by FY 2032 • Reduce 27.5% Scope 3 by FY 2031 − Green
Slide 36: ESG Commitments & Targets
ESG Commitments & Targets ESG Commitments − To be in Top 20 companies of the world in ESG benchmarking of electric utility sector by FY25 − To purchase RE power at AEML 60% by FY27 (committed under SLB framework) & 70% RE sources by FY2030 − To reduce Emission intensity [tCO2e/ EBITA] @ AEML by 40%
Slide 37: ESG Ratings, Awards and Recognition
ESG Ratings, Awards and Recognition ESG Commitments ESG Ratings AESL’s Rating Ranking of 87%, with consistent ranking above Electric & Gas Utilities industry average [911 companies] ESG Risk Rating of ‘Medium Risk’ with a score of 25.3 in February 2024 (improved from High Risk - 32.8 in April 2023),
Slide 38: AESL: Compelling Investment Case
AESL: Compelling Investment Case − Evolved and stable regulatory regime has enabled growth of AESL’s business into multiple segments (Transmission, Favorable Industry Distribution, Smart metering, District cooling) within energy domain Landscape − Focus on Grid reliability, consumerism and shift to
Slide 39: AESL: Board and Management Team
AESL: Board and Management Team Board of Directors Board Committees Independent Directors 100% Chaired Chaired IDs by IDs by NID Meera Shankar Statutory Committees 40% Lisa MacCallum - Audit 🗹 Comprised of only Independent Directors 45+ Yrs of Experience 25+ Yrs of Experience - NRC 🗹 Skill &…
Slide 40: Annexures
Annexures 41-44 ESG Initiatives 45-47 Regulatory Framework 48 AEML – Case Study 49 Smart Metering – Key Benefits 50-53 Project Level Details – Asset Portfolio 40
Slide 41: Environment: Key Environmental Indicators and Milestones
AESL: Key Environmental Indicators and Milestones Key Performance Indicators Current Status Baseline Short to Medium-term Targets Energy Mix & Emission Intensity AEML has achieved 39.06% renewable in power mix as of - RE share in power procurement 3% FY19 60% by FY27 70% by FY30 Sept 2024 AEML has r
Slide 42: Social: Key Social Indicators and Milestones
AESL: Key Social Indicators and Milestones Material Actual Target Material Themes Key Performance Indicators Baseline Categories (1HFY24-25) (FY24-25) Zero Rate of fatalities per million hours worked Zero Zero (FY 20-21) Work related injury Rate of recordable work-related injuries per 0.33 0.23 Zero
Slide 43: Governance: Key Governance Indicators and Milestones
AESL: Key Governance Indicators and Milestones Material Categories Material Themes Key Performance Indicators Baseline Actions Taken and Goals 16.6% - women Board Gender Balance the board composition in terms of men • % of women directors in board improved to Board Gender Diversity directors in boar
Slide 44: AESL: Enhanced Safety Culture
AESL: Enhanced Safety Culture Safety Initiatives During Q2FY25 Safety Performance in Q2FY25 • Safety training: 47,771 man-hours of safety training and awareness during Q2FY25 Transmission Distribution (AEML) • Positive Safety Culture: Safety Parameters Q2FY25 Q2FY24 Q2FY25 Q2FY24 o Conducted group s
Slide 45: Stable Regulatory Framework
Stable Regulatory Framework The Electricity Act 2003 RAB Based Transmission and Distribution Assets Fixed Tariff Transmission Assets Section 62 - RAB Assets - Multi Year (5 yr) Tariff Section 63 – Fixed Tariff Method – License Period Basis Services Costs (Pass- O&M Expenses Power Procurement All oth
Slide 46: Payment Pooling Mechanism Reduces Counterparty Risk
Payment Pooling Mechanism Reduces Counterparty Risk Regulatory landscape CERC and SERC established & predictable in maintaining and defining tariffs • CERC, MERC and other ERCs have a Long-Standing History • CERC and state regulatory body (e.g., MERC, RERC) MYT Determination of Maintaining and Defin
Slide 47: AEML: Operating in a stable and evolved regulatory framework
AEML: Operating in a stable and evolved regulatory framework with predictable & robust returns Tariff is based on assured return on capital model + pass-through of costs + efficiency linked incentives Incorporated in 1999, MERC is the Normative costs Assured return on Efficiency linked Regular True
Slide 48: AEML Case Study: Successful Acquisition and Turnaround
AEML Case Study: Successful Acquisition and Turnaround ✓ Uptick in regulated capex (INR cr) RAB (INR cr) – Low capex pre-acquisition on account of liquidity constraints Post-acquisition Projection – Investment in capex resulting in asset hardening → supply Pre-acquisition 8,485 1,409 1,404 1,449 1,3
Slide 49: Smart Metering – Key Benefits
Smart Metering – Key Benefits Technology transformation Real time information Two-way communication Key technology towards the Measures electricity consumption & Between the meter and the power utility through transformation of power sector in India communicates the consumption reading to the cellul
Slide 50: AESL's Operational Asset Portfolio as of October 2024 (1/2)
AESL’s Operational Asset Portfolio as of October 2024 (1/2) Adani Energy Solutions Limited 100% 100% 75% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% ATSCL & WTGL, PPP Bikaner ATIL MEGPTCL AEML MUL ATBSPL ATRL RRWTL CWRTL FBTL GTL APTL STL Khetri Discom Discom MTSCL WTPL 8/9/10 M
Slide 51: AESL's Operational Asset Portfolio as of October 2024 (2/2)
AESL’s Operational Asset Portfolio as of October 2024 (2/2) Adani Energy Solutions Limited 100% 100% 100% 100% 100% 100% 100% 100% 100% Obra-C Lakadia WRSS – XXI Jam Karur Kharghar Khavda- ATSTL Khambaliya WKTL - Vikhroli Bhuj (EPTCL) Badaun Banaskantha (A) Transmission Obra Lakadia Lakadia - Jam Wa
Slide 52: AESL's Transmission Under-construction Asset Portfolio as of October 2024
AESL‘s Transmission Under-construction Asset Portfolio as of October 2024 Adani Energy Solutions Limited 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Khavda Line & MP AEMIL Khavda Khavda Phase IV NKTL WR-SR KTL KPS-1 STSL Navinal Jamnagar SS Package II HVDC# – III - A – IV - A Pa
Slide 53: AESL's Smart Metering Under-construction Portfolio as of October 2024
AESL‘s Smart Metering Under-construction Portfolio as of October 2024 Adani Energy Solutions Limited 100% 100% 100% 100% 100% 100% 100% 100% 100% MSEDCL MSEDCL BEST APDCL APEPDCL APCPDCL APSPDCL NBPDCL UPCL NSC-05 NSC-06 BEST Smart NE Smart Adani Adani Adani Adani Adani Adani Energy Adani Metering L
Slide 54: Thank You
MUSHKILON KI adani 4 NAHI SUNTE, HUM KARKE DIKHATE HAIN, #HumKarkeDikhateHain @ adani Energy Solutions Thank You
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