Release Date: May 03, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Inox Wind Ltd (BOM:539083, Financial) reported a significant increase in revenue, with Q4 FY24 revenue at INR563 crore, up 190% YoY.
- The company achieved a positive EBITDA of INR140 crore in Q4 FY24, compared to an EBITDA loss of INR25 crore in Q4 FY23.
- Inox Wind Ltd (BOM:539083) reported a profit after tax of INR38 crore in Q4 FY24, reversing a loss of INR115 crore in Q4 FY23.
- The company has a healthy order book of 2.7 gigawatts, setting a strong foundation for FY25.
- Inox Wind Ltd (BOM:539083) has successfully reduced its external net interest-bearing debt to INR655 crore by the end of FY24.
Negative Points
- Despite the positive financial results, Inox Wind Ltd (BOM:539083) still reported a loss after tax of INR51 crore for FY24.
- The company acknowledged potential quarterly volatility in EBITDA margins, despite maintaining a full-year guidance of 14% to 15% for FY25.
- Execution challenges remain a concern, particularly in scaling up operations to meet the increasing demand for wind power capacity.
- There were some delays in execution, with the company not meeting its initial guidance of 450 megawatts for FY24, achieving slightly lower numbers.
- The transition from two megawatt to three megawatt wind turbines has led to some operational challenges and adjustments, impacting short-term performance.
Q & A Highlights
Q: Can you please help us understand how much of the 10 gigawatts of wind tendering was hybrid and how much was standalone?
A: Around 15 gigawatts plus of hybrid FDRE and RTC tenders were awarded in FY24, with roughly eight to nine gigawatts being effective wind capacity. Additionally, 2.3 gigawatts of plain vanilla wind projects were awarded, totaling around 10 to 11 gigawatts of effective wind capacity.
Q: How do you see the FDRE and C&I bidding market moving ahead?
A: India aims to achieve 140 gigawatts of wind by 2032, translating to 12 to 13 gigawatts of annual wind power supply. Realistically, the Indian wind market could comfortably be an eight to 10 gigawatt play per annum.
Q: What are the timelines for scaling up to gigawatt-scale execution?
A: We are scaling up smoothly and are virtually in position for gigawatt-scale execution. We are gearing up further for two gigawatt scale, with internal targets higher than market expectations.
Q: What led to lower execution for Q4 compared to the guidance of 450 megawatts?
A: We have grown significantly from 70-80 megawatts to around 380 megawatts. While there may be minor slippages, we are confident in our annual guidance of 800 megawatts for FY25 and 1,200 megawatts for FY26.
Q: What is the reason behind issuing the bonus shares?
A: The decision was based on investor feedback and the significant increase in share price, making it more accessible to retail investors. The Board decided to issue the bonus as a reward to shareholders.
Q: What is the expected revenue realization per megawatt for FY25?
A: On a full-year basis, we expect a blended realization of around INR6 crore per megawatt, translating to a top line of approximately INR4,800 crore for 800 megawatts.
Q: Are there any plans for offshore wind projects?
A: Currently, we are not focusing on offshore wind projects due to the higher cost of energy compared to onshore wind. India has sufficient onshore wind potential to meet its needs for the foreseeable future.
Q: What are the key risks for the next 1.5 years?
A: While there are normal business risks, we have all the building blocks in place, including a strong balance sheet, a healthy order book, and a robust management team. We are well-positioned for growth.
Q: What is the company's strategy for becoming net debt-free by H1 FY25?
A: We have multiple strategies in place, including operational free cash flows and potential stake sales. Our balance sheet is strong, and we are confident in achieving net debt-free status by H1 FY25.
Q: What is the expected CapEx for FY25 and FY26?
A: We expect CapEx to be around INR50 crore to INR75 crore for new molds and other requirements for the three megawatt product. This is in line with our operational needs.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
