Jsw Energy Limited · NSE:JSWENERGY
Jsw Energy — Investor Presentation (November 2022)
55 slides from Jsw Energy's investor presentation, November 2022
Slide 1: Accelerating for a Better Tomorrow
Accelerating for a Better Tomorrow Corporate Presentation November 2022
Slide 2: Forward Looking and Cautionary Statement
Forward Looking and Cautionary Statement This presentation has been prepared by JSW Energy Limited (the “Company”) based upon information available in the public domain solely for information purposes without regard to any specific objectives, financial situations or informational needs of any parti
Slide 3: JSW Group Overview
JSW Energy Steel Power producer with 9.9 GW locked-in portfolio, India’s leading integrated steel producer Targeting 20GW by 2030 (81% renewable capacity) Installed crude steel capacity of 29.2mtpa, growing to 38.5mtpa Market Cap: ~US$ 6.4 Bn Market Cap: ~US$ 21.4 Bn Infrastructure Cemen
Slide 4: JSW Energy: Our Vision
JSW Energy : Our Vision Bringing positive transformation to every life we touch 4
Slide 5: JSW Energy: Transitioning towards green energy
JSW Energy : Transitioning towards green energy FY2025 FY2030 FY2050 To become a 10 GW company To become a 20 GW company To become carbon neutral by 2050 Electrons to Molecules Foraying into products and services through energy storage solutions, green hydrogen and its derivatives 5
Slide 6: Agenda
Agenda JSW Energy at a Glance Sustainability Asset Overview Why JSW Energy? Risk Mitigation Annexures Acquisition of Renewable Portfolio of Mytrah Energy 6
Slide 7: JSW Energy – Company Overview
JSW Energy –Company Overview At a Glance The company is well placed to achieve its capacity growth target of 10 GW much ahead of the stated timeline of FY25 and being future-ready with increased share of renewables and new energy solutions. 9.9 GW 4.8 GW 2.6 GW 2.5 GW Diversified Asset Installed Cap
Slide 8: Healthy Operations and Financials (4.8 GW Operational)
Healthy Operations and Financials (4.8 GW Operational) Business model resilient with steady cashflow generation despite several sectoral headwinds 85% ~95% Net Generation (BUs) Total Income3 (₹ Crore) Capacity under LT PPA1 EBITDA contribution from LT 21.3 20.8 8,560 8,736 20.0 21BUs ₹ 2,395 Cr 7,16
Slide 9: Robust balance sheet to support renewable-led growth
Robust balance sheet to support renewable-led growth Large balance sheet headroom & strong cashflow available to pursue growth 1.77x 0.45x Net Debt/EBITDA Net Debt/Equity $ Bn4 Net Worth Net Debt 2.5 2.2 2.1 7.94% 66 2.0 1.4 1.4 1.8 Wt. average cost of debt Receivable Days 1.5 1.2 1.1 1.0 1.0 0.8 0.
Slide 10: Sustainability at JSW Energy
Sustainability at JSW Energy
Slide 11: Continuing our Health & Safety Excellence Journey
Continuing our Health & Safety Excellence Journey Awards & Zero severe injuries/fatalities (Q2 FY23 & YTD) Recognitions 89% of contractors covered by JSW CARES audit 9 Contractors achieve 5 Star rating & 3 contractors achieve 4 Star in a stringent Internal Safety Assessment 43,000+ Cumulative Safety
Slide 12: Sustainability: Framework and Policies
Sustainability: Framework and Policies 17 Focus Areas with 2030 Targets from 2020 as Base Year Governance & Oversight by Sustainability Committee Climate Change: Renewable Power: Biodiversity: Committed to being carbon Enhance the renewable power to No Net Loss for Biodiversity Mr. Sunil Goyal Indep
Slide 13: Sustainability: Targets and Strategy
Sustainability: Targets and Strategy FY20 FY30 SD Targets Actuals Targets Improvement Strategic Initiatives and Approach Increased share of renewable energy for deep decarbonization GHG Emissions Process efficiency improvements Climate Change 0.76 0.304 60% tCO2e/ MWh Replacement of condense
Slide 14: Sustainability: Q2 FY23 Performance
Sustainability: Q2 FY23 Performance Key Highlights Performance • Increased share of renewable energy for deep decarbonization Ash Utilisation (%) Climate • Solar 225 MW project at Vijayanagar: Generation started resulting in low GHG, Change CO2, SOx and NOx emissions 100% 100% 100% 100% • Biomass fe
Slide 15: Advantage JSW: Superior ESG Profile
Advantage JSW: Superior ESG Profile Board & Governance Air Emissions Water & Waste Management % Board Independent CO2 Internsity (t CO2e/MWh) Specific Fresh Water Consumption 63 60 1.02 (m3/MWh) 50 50 50 50 0.79 0.85 40 0.68 0.47 2.8 3.2 2.2 2.5 1.1 JSW Peer 2 Peer 1 Peer 5 Peer 3 Peer 6 Peer 4 Peer
Slide 16: Sustainability: Initiatives and Disclosures
Sustainability: Initiatives and Disclosures Plantation drives spanning across Ratnagiri, Green Belt & Plantation near Watershed Development at Barmer Vijayanagar & Hydro Power Plants Barmer Power Plant Comprehensive ESG Data profile with ~300 factors across 15 sustainability frameworks JSW Energy JS
Slide 17: Sustainability: Empowering Our Communities
Sustainability: Empowering Our Communities Sports Promotion & Development Health & Nutrition Project Shikhar: Organised inter– Strengthening public health Shikhar boxing championship with a infrastructure by supporting a participation of 60 boxers. Government hospital in Barmer. Participation
Slide 18: Strong Board Oversight and Leadership
Strong Board Oversight and Leadership Mr. Prashant Jain Mr. Pritesh Vinay • Majority Independent Board: 5/9 Mr. Sajjan Jindal Chairman & Managing Joint Managing Director Director (Finance) Directors are Independent & CEO Director • Fully Independent Audit and Remuneration Committees Audit Committee
Slide 19: Asset Overview
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Slide 20: Asset Overview – 9.9 GW Locked-In
Asset Overview – 9.9 GW Locked-In Green portfolio driving capacity growth Division of locked-in capacity (9,896) MW 39.0% 48.3% Installed (MW) Locked In Growth (MW) Installed Thermal 2,293 235 1,331 Under- 1,391 36.6% 22.6% 4,784 9,896 construction 3,158 Wind 422 3,158 1,757 700 Pipeline 17.8% 4.3%
Slide 21: Installed Portfolio – 4.8 GW
Installed Portfolio – 4.8 GW Barmer: 1,080MW 4.8 GW installed Baspa II: 300MW & Karcham Wangtoo: 1,091MW 4 Configuration: 8 X 135MW 34% Renewable Configuration: 3x100MW (Baspa II) ; 4x272.75MW (Karcham) Units operating: since 20093 66% Thermal Units operating: Baspa II since 20033 and Karcha
Slide 22: Under Construction Projects – 2.6 GW (1/3)
Under Construction Projects – 2.6 GW (1/3) 2.2 GW Renewable Projects Under Construction Portfolio Capacity Scheduled Target Plant Segment Location PPA/Offtaker (MW) Commissioning Commissioning SECI - IX 810 Wind Tamil Nadu 25-Year; SECI Dec-23 progressively from SECI - X 450 Wind Tamil Nadu 25-Year;
Slide 23: Update on Under Construction Projects (2/3)
Update on Under Construction Projects (2/3) SECI-IX & X Wind, Tamil Nadu (1,260 MW) Nacelle and WTG erection Locked In 9.9 GW Installed Capacity 4.8 GW Under construction & Pipeline 2.6 GW Under Acquisition 2.5 GW 23
Slide 24: Update on Under Construction Projects (3/3)
Update on Under Construction Projects (3/3) Kutehr HEP, Himachal Pradesh (240MW) Steel Cantilever Bridge HRT Gantry Concrete Lining Kutehr HEP Completed ~84% (17.7 km) tunneling work (up from ~75% in Q1) well ahead of timelines Locked In 9.9 GW Installed Capacity 4.8 GW Under construction & Pipeli
Slide 25: Under Acquisition 2.5 GW - Mytrah Energy
Under Acquisition 2.5 GW - Mytrah Energy Value Accretive Deal Mytrah RE Assets: Geographically diverse Acquired portfolio consists of 422 MW solar and 1,331 MW wind The assets were acquired at an EV of approximately ₹ 10,530 Cr after adjusting for net current assets implying a EV/EBITDA multiple
Slide 26: Under Acquisition 2.5 GW - Ind-Barath
Under Acquisition 2.5 GW - Ind-Barath • Corporate Insolvency Resolution Process initiated against ‘Ind-Barath Aug-2018 Energy (Utkal) Limited’ pursuant to NCLT order • Expression of Interest submitted Dec-2018 • Resolution Plan submitted May-2019 Ind-Barath • Earlier Process annulled & JSWEL submitt
Slide 27: Why JSW Energy?
Why JSW Energy ? Committed to reaching Net Zero emissions by 2050
Slide 28: Compelling Investment Story
Compelling Investment Story 1 At the forefront of Energy Transition Scaling to 20 GW (81% renewable) by 2030 Being future-ready : New Energy Solutions including energy storage, green hydrogen, Sustainable growth ammonia and its derivatives Resilient Business, Consistent Performance and Strong fi
Slide 29: Compelling Investment Story
Compelling Investment Story 1 At the forefront of Energy Transition Scaling to 20 GW (81% renewable) by 2030 Being future-ready : New Energy Solutions including energy storage, green hydrogen, Sustainable growth ammonia and its derivatives Resilient Business, Consistent Performance and Strong fi
Slide 30: Twin Engines of Growth for significant value creation
Twin Engines of Growth for significant value creation Scaling towards 20 GW installed capacity by 2030 Transitioning towards Energy Products and Services Operational Under-Construction Pipeline * Acquisition** Energy Storage Hydro Pumped Storage (PSP) - Targeting 10 GW Resources tied-up for ~6 GW
Slide 31: Being Future Ready: Hydro Pumped Storage Projects (PSP)
Being Future Ready : Hydro Pumped Storage Projects (PSP) India’s Market Potential JSW’s Plans In Advanced Stages for 6 GW PSP Only 3.3 GWh operational out of 97 GWh potential • Signed MoUs with Govt. of Maharashtra for 2.5 GW, Govt. of Telangana for 1.5 GW, Govt. of Chhattisgarh for 1 GW for • Hyd
Slide 32: Being Future Ready: Battery Energy Storage Solutions (BESS)
Being Future Ready : Battery Energy Storage Solutions (BESS) India’s Market Potential JSW’s Plans 52GW/258GWh1 installed capacity by 2032 Participated in SECI bid for the largest utility scale pilot • Facilitate RE capacity integration by addressing intermittency BESS project (500MW/1000MWh) • Bal
Slide 33: Being Future Ready: Green Hydrogen Potential
Being Future Ready : Green Hydrogen Potential Non- fossil fuel based Advantage India energy capacity target of 500GW by 2030 Reduce carbon Significant Hydrogen demand Huge RE potential Low Tariffs emission by 1bn tonnes by 2030 Current demand ~6 MMT expected Existing RE capacity of ~165 GW RE tariff
Slide 34: Being Future Ready: Green Hydrogen
Being Future Ready : Green Hydrogen India’s Market Potential JSW’s Plans Significant H2 demand H2 • India - 2nd largest hydrogen demand base in the world To tap significant clean energy market opportunity in India and become a front-runner in a future hydrogen economy • H2 demand expected to grow
Slide 35: Being Future Ready: Energy Products & Services - Value Unlocking
Being Future Ready : Energy Products & Services - Value Unlocking All India Peak Demand Pattern (2021)1 Varying power demand requirements and rise of utility scale renewable projects is leading to innovative approaches that encourage pairing solar/wind with storage technologies to Morning offer “rou
Slide 36: Compelling Investment Story
Compelling Investment Story At the forefront of Energy Transition Scaling to 20 GW (85% renewable) by 2030 Being future-ready : New Energy Solutions including energy storage, green hydrogen, Sustainable growth ammonia and its derivatives Resilient Business, Consistent Performance and Strong fina
Slide 37: Proven project execution and operational excellence
Proven project execution and operational excellence… Prudent and consistent capital allocation strategy for growth over a 25 year history One of the lowest project execution cost in the industry Business model resilient despite several sectoral headwinds over the last decade 2014 2014 2013 2014 2013
Slide 38: Compelling Investment Story
Compelling Investment Story At the forefront of Energy Transition Scaling to 20 GW (85% renewable) by 2030 Being future-ready : New Energy Solutions including energy storage, green hydrogen, Sustainable growth ammonia and its derivatives Resilient Business, Consistent Performance and Strong fina
Slide 39: Steady Operations and Robust Financials
Steady Operations and Robust Financials Consistent Asset Performance Low Trade Receivables Net Generation (BUs) Total Income3 (₹ Crore) 1,769 1,769 1,648 21.3 20.8 8,560 8,736 20.0 7,160 5,712 12.5 Sep 30, 2021 Jun 30, 2022 Sep 30, 2022 FY20 FY21 FY22 H1 FY23 FY20 FY21 FY22 H1 FY23 Receivable 81 45
Slide 40: Best-in class balance sheet & cash flows to support renewable-led growth
Best-in class balance sheet & cash flows to support renewable-led growth Large balance sheet headroom to pursue growth opportunities Healthy internal accruals to support growth Strong credit metrics : Operational Portfolio (4.8 GW): Steady operations and robust financial: Track record of strong ye
Slide 41: Risk Mitigation
Risk Mitigation
Slide 42: Adequately addressing key risks and concerns (1/2)
Adequately addressing key risks and concerns (1/2) Key Risks/Concerns Favourable Policy Support and Market Interventions Mitigation Strategy by JSW Energy Well established central agencies (SECI, NTPC) for managing PPAs Existing portfolio: 85 % PPA signed which forms about 95% of Discoms/offta
Slide 43: Adequately addressing key risks and concerns (2/2)
Adequately addressing key risks and concerns (2/2) Key Risks/Concerns Favourable Policy Support and Market Interventions Mitigation Strategy by JSW Energy Hydro plants under ‘Must-run status’ with no scheduling risk Must-run status for renewable; Rule notified to provide regulatory support ~98
Slide 44: JSW Energy: Key Highlights
JSW Energy : Key Highlights Superior project execution skills: Projects set-up in lowest cost & time Proven Execution Differentiated business strategy for growth to 20 GW, driven by Renewable Excellence Foraying in New Energy Platforms: Green Hydrogen, Energy Storage, Energy Products & Service
Slide 45: Investor Relations Contact
Investor Relations Contact: ir.jswenergy@jsw.in ESG Data Profile: Link 45
Slide 46: Annexures
Annexures
Slide 47: Broad Corporate Structure: Existing
Broad Corporate Structure : Existing Ratnagiri – 1,200 MW Vijayanagar – 860 MW Hydro Entities JSW Energy Limited Nandyal – 18 MW Solar – 10 MW Solar/Wind Entities Total – 2,088 MW JSW Hydro Energy Limited JSW Energy (Barmer) Limited Jaigad Power Transco JSW Power Trading Co. (1,391 MW) JSW Future En
Slide 48: JSW Neo Energy – Green Energy Vehicle of JSW Energy (Post-Restructuring)
JSW Neo Energy – Green Energy Vehicle of JSW Energy (Post-Restructuring) Hydro Entities JSW Energy Limited Solar/Wind Entities JSW Neo Energy * 6,028 MW Renewable Portfolio Pipeline JSW Hydro Energy JSW Renewable JSW Renew Energy JSW Renew Energy JSW Renewable of Mytrah Energy SECI XII 300 MW Limite
Slide 49: JSW Neo Growth Framework
JSW Neo Growth Framework Value Accretive Business Implementation Execution Efficiency Model De-risking Prudent selection of growth opportunities Life cycle approach Group’s project execution excellence • Bidding based on P90 generation assumption • Land acquisition, De- scoped project • Fast executi
Slide 50: Value Accretive Business Model
1 Value Accretive Business Model Conservative assumptions for business model Prudent selection of growth opportunities to target a niche segment of market offering healthy returns – Mid teen IRRs High quality offtakers - Captive PPAs with JSW Group companies (strong credit ratings) at arm’s length p
Slide 51: Life-cycle Approach towards Renewable (1/2)
2 Life-cycle Approach towards Renewable (1/2) Project Construction and Land Acquisition Power Evacuation • De-scoping of EPC packages to have competitive edge • Strategic selection of ISTS substations for connectivity with high capacity margins to facilitate future • Synergies with group businesses
Slide 52: Life-cycle Approach towards Renewable (2/2)
2 Life-cycle Approach towards Renewable (2/2) Quality Supplier & Vendors O&M Control • Robust selection process • Dedicated team for quality • Skilled in-house O&M team through competitive route; assurance Award of packages to best-in- • Continuous implementation of class / Tier-I vendors only • Sta
Slide 53: Implementation De-risking
2 Implementation De-risking Long Term PPA ensuring steady cashflow Typical timelines for PPA signing & Tariff adoptions PPA signing – 90 days from LoA issuance Tariff Adoption – 120 days from the Effective date of the PPA JSW approach: Proactive approach to get the PPA/PSA executed and tariff
Slide 54: DNA: Group's project execution excellence
3 DNA: Group’s project execution excellence Achieved best in the industry project commissioning timeline for Kutehr project completion expected well before solar projects scheduled timelines Commenced operations at 225 MW solar power plant at Vijayanagar in Apr’22. The plant is installed on approx
Slide 55: Growth Framework leading to industry-leading returns
Growth Framework leading to industry-leading returns Single digit to lower Mid-teen High-teen teen IRR% IRR % Returns Realized Equity Pre-Bid Project Execution JSW Energy Potential Upside Realized IRRs Preparation Target Returns Levers Post COD Returns Current market returns Bidding with No Turn