Good morning everyone, and on behalf of Emkay Global, I welcome you all to the Q2 FY '27 post earnings conference call of Adani Green Energy Limited. We have with us the top management from the company, led by Mr.

Ashish Khanna, CEO, Adani Green; Mr. Rajat Seksaria, CEO, BESS; Saurabh Shah, CFO; and Vijil Jain, Head Investor Relations.

Today's session would be opening remarks and update on the performance by the management, followed by the question-and-answer round. Now without any further delay, I would request Mr.

Khanna for the opening remarks. Over to you, sir.

Thank you, Sabri. Good morning, everyone, and thanks for joining this call on our Q2 FY '27 results.

As we know, India's energy transition is gaining unprecedented momentum as the country rapidly scales renewable energy and electrification to strengthen energy security and advance its decarbonization and sustainability goals. With about 308 GW of installed non-fossil fuel capacity, representing more than 54% of total installed power capacity, the country is progressing rapidly towards the 500 GW target by 2030.

India's peak electricity demand continues to reach new highs, reflecting rising consumption driven by industrial growth, electric mobility, data centers, and the broader electrification of the economy. Against this backdrop, Adani Green Energy delivered another strong performance in H1 FY '27, crossing the significant milestone of 20 GW of operational capacity.

Our 20.8 GW portfolio supplied clean power equivalent to the needs of more than 4.4 million homes, while helping avoid 17.5 million tonnes of CO2 emissions during the period. Our operating and financial performance remained robust.

Energy sales increased 32% year-on-year to 25.7 billion units in H1, supported by a 24% increase in greenfield capacity additions on YoY basis. Revenue from power supply in H1 FY '27 increased 36% year-on-year to ₹8,299 crore, while EBITDA grew 41% YoY to ₹7,957 crore, enabling us to deliver industry-leading EBITDA margin of 93%.

The total EBITDA during H1 FY '27 was ₹8,276 crore. If curtailment would not have been there, this EBITDA would have been close to 9,000 crores.

The performance during quarter two was equally strong, with revenue from power supply increasing 45% year-on-year to ₹4,019 crore, while EBITDA from power supply ending 51% higher YoY to ₹3,835 crore, resulting in strong EBITDA margin of 92% during the quarter. Energy storage is becoming the next major pillar of our growth.

During the quarter, we commissioned 3 GWh of battery energy storage at Khavda, taking our total installed storage capacity to 6.6 GWh. This capacity accounts for more than 50% of India's operational BESS.

We remain firmly on track to exceed 10 GWh during the year, while our maiden 500 MW pump storage project at Chitravathi is also progressing towards its completion by year end. At Khavda, the world's largest renewable energy plant, we have commissioned 10.8 GW of solar, wind, and hybrid capacity.

Our focus on technology, digitization, and advanced analytics continues to support high asset availability and strong operating performance across the portfolio. Looking ahead, we see significant opportunities emerging from growing needs for firm and dispatchable renewable energy, rising power demand from AI, data centers, and hyperscalers, alongside growing demand for integrated renewable plus storage solutions from commercial as well as industrial customers.

Our investment in BESS is also helping mitigate curtailment challenges at Khavda by providing greater flexibility in managing renewable energy generation and enabling the utilization of power that would have been otherwise wasted. We will continue to closely monitor the developments on transmission infrastructure availability at Khavda, and at the same time, we have significantly accelerated the development of BESS to insulate ourselves from delays, if any, on transmission network.

We remain focused on disciplined execution of our 2.4 lakh crore capex program through FY '30, backed by securing new capacities under long-term contract and prudent capital allocation. We remain committed to maintaining 13% to 14% ROA threshold by tying up capacities with AA+ counterparties.

At AGEL, we remain neutral from counterparty standpoint and will pursue opportunities that deliver high returns while offering long-term contractual visibility and desired credit quality. On sustainability, AGEL retained its number one global ranking in alternative electricity subsector by FTSE Russell for the second consecutive year.

Our Khavda BESS project was also recognized as the largest project of the year at India Energy Storage Week 2026. Additionally, our Chitravathi, Gandikota, and Tarali pump storage projects received the Best Construction Safety Excellence Award at the IBC Safe India Conclave and Awards.

As India's power requirements grow, our strategy is clear: combine renewable energy at scale with storage, technology, and disciplined execution to deliver most reliable clean power. Thank you.

Please do.

Good morning, sir, and congratulations on a very good set of results. My first question is can you just talk about the transmission asset commissioning, especially in Khavda region?

Have you seen any acceleration from the Power Grid side or the other players to accelerate this commissioning so that they will lesser and lesser the curtailment as you go forward here?

Thanks Mohit for your question. I think we don't have any doubt about the credibilities and the capabilities of whether it is AESL or Power Grid on execution of these transmission lines.

We are monitoring it very closely, too. I think there are certain things which are not helping them with respect to ROW issues, on which they are working very closely.

Both the state and central government has a lot of focus towards it. From our side, while it is out of our control, but we closely and very closely monitor it and are aware of all the efforts which they are taking.

Understood. I'll take it offline, maybe.

The second question is, what are your target for commissioning in this fiscal, and how much of this capacity is tied up under C&I?

See, we we originally have at the end beginning of the year a target of 4.5 to 5 GW, which we shared with you. From our side, you first asked the question on the point of a transmission line.

Let me say that we were earlier expecting this to come by the end of this year. Now we are expecting this transmission line of Phase 3, the evacuation to come by the next quarter.

That's where we currently look at it. Now, we are fully capable of commissioning the projects as and when this transmission line comes.

I'll share with you that in the learnings of the past which we have is that we have invested fully and are now working on completing all the infrastructure and what we call the balance of system from our end so that whenever there is a certainty of this transmission corridors of being available, we would able to very quickly deploy our modules and commission our project. We still believe that if this corridor comes by the end of this next quarter, I mean quarter four, we will be in a position to commission 4.5 to 5 GW here.

Understood, sir. Sir, is it possible to share out of 4.5 GW which you'll commission, how much of this capacity will be tied up in C&I?

Do we still maintain the target of installing 10 GWh of battery, if I'm not wrong, 14 GWh of battery by the end of this fiscal?

We are very committed to not only commission the 10 GWh by the end of the year, but would definitely able to surpass it, too. Yes, we are very confident of achieving it and also surpassing it.

Regarding the C&I business, I think we in the past also, the last quarter has clearly said that the way we are working is and what is required for this company for our capital expenditure and for our growth is to have a sustainable partner who are there with us for next 25 years. Our returns on our investment comes on 13% to 14% of ROA, and that is where we stand.

On this long-term and this AA+ partners which we look at, AESL is definitely one of the company which is there, and that's what our strategy is. We keep on looking for organizations which give us a return.

In the past it has been AESL, in the future it could be them, too, on that matter. We are very clear from our side, like I told you, we are firm on our return on our assets in 13% to 14%, and looking for a long-term tie-ups of 25 years with all our efforts.

Understood. My last question, sir, what happens to the payment under curtailment for your PPA and the C&I?

See, all our PPAs are on a take-or-pay basis on the supply which we give it to them.

Understood. Curtailment,

whenever there is a curtailment from the grid to us, specifically being asked, we are paid for it as a deemed generation.

For all the PPAs, right?

For the PPAs which we have signed, yes.

Understood, sir. Thank you and all the best.

Thank you.

Good morning, sir, and thanks for taking my question, and congratulations on a decent operating performance. Sir, one broader level question is on the interest rates.

We are seeing a surge in yields across India and globally. On this related issue, what steps are we taking to minimize the overall impact of this surge in yields?

As well as how do we see our interest rates moving from the current 8.9% whenever the next reset happens? Also, on the rating portfolio, what efforts are we further taking to ensure the minimal impact?

Thanks.

Thanks, Nirav, for your question. See, from Adani Green perspective, 72% of our loans, project loans that we take, are all fixed rate for a medium-term to long-term.

Between three to five years, we are fully fixed. The rate cycle effect does not happen for a very substantial portion of our loans.

Also, other than that, what happens is that because we are into a 25-year fixed-tariff PPA scenario, a small cycle change does not affect the overall returns on the projects. Thirdly, what happens is that from the credit perspective, our credit rating works in a way that during under construction, we are given a rating which is in generally between a BBB- to A category.

When we are operationalized, as soon as we get operationalized, that rating generally moves to a AA category. Once that rating moves to a AA category, you easily get a 50 basis points reduction.

What happens is that every notch increase, and see, very recently, one of our SPVs, which the news, I'm very happy to share that the news has come yesterday night, one of our SPVs, AG23L, which is nearly 15% of Adani Green's overall EBITDA, has now become a AAA asset. Now, when something like that happens, in that entity, what happens is that the rate of interest which was earlier at near to 10%, 11%, has gone down to today at 8.4%.

Similarly, every notch increase gives us increase in the rating and reduction in our interest cost. At Adani Green level also, in the past seven years, if you will see, we have been at 11.1% in 2019, today we are at 8.9%.

Now, this reduction of nearly 200 basis points, which has happened, more than 220 basis points, which has happened with whatever rate cycle changes have happened in last seven years. In seven years also, the rate cycle has gone up and down, it has not changed for us, our interest rates continuously goes down.

See, when we are today at 20 GW of operating capacity, doing 5, 7, 8 GW of construction, and with battery also we are doing more construction today, our under construction portfolio still is about 30% of our overall portfolio. Now, once we reach 30 GW of operating capacity, our under construction portfolio will be 20% or 10% of our portfolio.

What happens is that under construction only the interest rate has a very larger impact, otherwise it starts to taper off. This, from our perspective, we see that the transition to more and more operating capacity with a 25-year PPA, there should not be any major impact on our interest rate cycle even with a interest rate cycle going up.

Our interest rate should not be affected much. Just to repeat, with a 72% to 73% of our portfolio being a fixed rate portfolio in a medium-term range of five years, it doesn't impact much.

Yeah? Hope I have answered.

No, absolutely. That's very heartening to hear.

Especially, it alleviates a lot of investor concerns regarding the interest rate impact on our operations. Sir, second question is on the evacuation.

You just mentioned in the earlier question that 7 GW line is commissioning now in fourth quarter of financial year compared to third quarter. There was another 7 GW line, is that on track or it's pushed back by one quarter?

That is also, as we speak, looks to be delayed on that particular part. Currently, we are more focused on this first one, because most of our evacuation and our investments at Khavda is going through this particular corridor.

That is where we are now more focused on. See, there are two things which we have done, Nirav.

One is that we have focused not only on the getting the lines through. This 7 GW gives us the full GNA capacity, this entire 7 GW is coming to us in that sense.

Out of that, the existing whatever the curtailments are will be removed, and plus we will be able to execute more on that capacity. Secondly, we have accelerated our BESS development in a very big way to ensure that the curtailment impact are lesser on the company.

You will see that in the second half of the year, the curtailment impact should not be as high as the earlier half, because of the accelerated development on the batteries that we are doing. Yeah?

If I can just add on this, if you look at it, Nirav, there has been, like we said, challenges on it. First is we are closely monitoring it, but yes, more importantly, our accelerated efforts on the battery storage is also helping us to mitigate to a large extent that curtailed power from Khavda in particular.

That's what we are doing.

Got it. Great, great.

Thanks, sir, and wish you all the best, sir.

Thank you.

Yes, thank you. Sir, a question on battery.

Given our strategy of de-risking battery through long-term contracts, we wanted to understand what is the current tie-up that we have on the C&I front with respect to solar, wind, and batteries? Just from a three-year perspective, we look to install, let's say, about 10 GWh every year.

What's the amount of battery that you think will install, and correspondingly how much solar and wind will be needed for the overall C&I demand?

See, understand, Aniket, we don't differentiate between a C&I demand or any other demand. We are a developer who has a long-term tie-ups, whether it is B2B or B2G per se.

There is as a developer a business opportunity to have battery in place and then have a long-term tie-ups from whether it is further used on a C&I basis. Like I said earlier, we are very clear why are we putting and what we are putting.

We are installing batteries because, of course, there is a demand for a peak power as well as for RTC, but more importantly, we are looking at it as a long-term asset to us, which gives us 13% to 14% return on a long-term basis. I think this we have emphasized quite a lot.

With organizations, whether it is a government organizations or it is a business houses, which can meet our requirements of being at least a AA+ and have a solid PPA on the terms of what is there like SECI on those terms and conditions. These are the parameters on which we work.

These are the benchmark which we use. Like I said, AA+ organization, terms and condition like SECI PPAs, and a 25-year agreements on that.

Now, with these parameters in place, whether it's a government DISCOM or it is organization like AESL, we go ahead on this basis. I hope I have been able to clarify to your question.

As far as the capacity addition, we are definitely looking for this year, like we said, we already mentioned we have committed 10 GWh. We have already reiterated that because there could have been a transmission corridors which are taking some time, our efforts towards battery and the capex has been now more infused out there, too.

With the result, we are very confident of surpassing that particular target which we have already shared with you.

Got that. Just a clarification, of that 10 GWh that is coming up, how much of that is tied up in long-term contracts?

See, currently we have 3.3 GW 3.5 GWh which is already tied up. The rest, since it has just come at the end of this last quarter, we are in the process of doing it.

I think I missed your earlier question, just been reminded of, that how much solar or wind or other input power is required for it. It is already available with us.

We have no challenge as well as the solar, and if required, wind for an input power for that battery storage.

Got that. The other question was also on the solar CUFs that you've reported.

If I look at 1H to 1H, we've seen a dip to about 23% versus 24.8%. I'm assuming a decent part of that could be curtailment related.

If you could just provide some color on that, what's the amount of curtailment on like-to-like basis what this number would have looked like, that would be

helpful. You have guessed it very right.

It is primarily on account of the curtailment, too. There are always a seasonal change for that matter, which is there.

When you look at a six-month horizon, yes, it is predominantly on behalf of the curtailment, too. Otherwise, our plants are operating very well on that matter.

There has been no challenge. In fact, we have been working better if you look at it from the operational efficiency standpoint.

In a more elaborate manner, if the CUF depends on my plant capacity utilization factor, which will depend on the resource on which it is coming, also how much I have been able to evacuate. The resource part of it is more or less same, if I say that.

It has been slightly better this year, which is also reflected on our revenues as well as profit. Of course, we have grown from last year to this year half yearly.

In the same manner, because we have grown and there has been a curtailment which is more than the last six months, the CUF has been dipped. Once this evacuation corridor is available to us, we would be having the CUF which is worthy of what we should be with the resource in place.

See, Aniket, in a 25-year profit business or a project business, 1 6 3 to 6 months here and there on curtailment will not have a very major impact on the return on asset on an asset. From our perspective, yes, there has been on a quarterly basis a small blip again from the perspective.

What happens is that to some extent we were aware there was certain amount of additional change which has happened in terms of when we are expected to get the curtailment, another three months here and there. It will not have a very larger impact on what we assume as our return on asset on the asset, because what happens is that this is a 25-year period and a three-month, six-month change will not have that bigger impact on us.

Plus, many of our assets have also been before time. Our returns on that 25-year period remains with us.

This is just that extra one which we were looking forward for bringing some assets before time.

Got that. Thank you.

Those were my questions, sir.

Hello, sir. Congratulations on a great set of numbers.

I just wanted to get a sense on the Phase 6 and Phase 7 ordering of the transmission connectivity for Khavda, and if there's any HVDC component on that, because that would impact your FY '30 target, one. Second, if there's a delay on that side, do we have alternate resources in terms of land or new sites that you have identified to meet your FY '30 target in case the Khavda connectivity doesn't get resolved?

That were the first question that I have.

That's a good question. Would have been better off with those PGCILs and CTUILs, too, frankly.

Let us give you, because we closely monitor it and we also put efforts on it. Yes, there are developments on the scheme level which is happening on Phase 6 and Phase 7 as we are aware of it.

Having said that, we are committed for our targets towards 2030. In that process, if you see, the battery storage is going to play a very important role as a mitigation measure, too, in case there is any changes or delays on Phase 6, primarily on Phase 6.

Plus, I think we are also looking at various other states, too, including Rajasthan, where decent amount of capacities can also come. I think from our standpoint, we are committed to surpass what has been already stated as well as our target for FY '30 is concerned.

Rajat Seksaria here on the battery side. I just want to give one one piece of perspective, which gives us a bit more confidence.

While the media releases have been about the capacities we have either put up or about to put, what is also worth noting, the time in which we have put up. It's a relatively short period of time, we're talking about months, 8 to 10 months, for the largest plants in the world.

That gives us a adequate amount of flexibility, should the situation demand so, we now have an added tool in our arsenal to respond to that, so that executing more solar and possibly wind is kind of de-constrained by any delays that may happen on transmission. Versus last year if you compare, this year we certainly have a very, very strong arsenal in our hand as a group, as Adani Green, to take care of that.

That is why I think if anything things have improved by having this virtual transmission effectively through a battery system that we have, and this can be deployed very fast, does not require too much of land, already the substations are there. That is why you see of all the deployments that has happened in India, roughly we are striding 50% of that.

That, I think, is something you should be bearing in mind now.

Right. On the near term, sir, let's assume that if the Phase 3 gets delayed instead of Q4 to Q1, what would be your strategy?

A, would you want to delay your capacity installation and miss the guidance, or B, you would install more BESS to meet the guidance? What strategy would you apply if the Phase 3 gets to Q1 next year?

That's a

good question. We have lessons in the past, and being an organization which is always improving, and even while we are the biggest, the largest, and the best in the country as well as renewable is concerned, we keep on learning a lot in this process.

Our lessons of the past is to commission project when the transmission corridors are there. Accordingly, what we have done now is that all the balance of the system which is required for our asset, which are to come on Phase 3, we are working on it.

We are all working towards making sure that all the balance of the system and the infrastructure is ready, so that whenever we have a certainty of our evacuation in our system as well as solar is concerned, we will just put on the modules so that we are ready with our commissioning as and when the evacuation comes. You will appreciate the fact that in our business, just putting on the modules is possible.

A 20, 30+ MW, we have done it on each day basis. We have timed it up in a manner, or we will time it up in a manner, so that we can very quickly install the modules because all our balance of system and other infrastructure is ready.

That's how we are working on it, and that is our strategy, not a strategy, but our way of working right now.

Right. From that perspective, that's what I'm trying to understand.

Plus, if you also see, that this whole enhancement and accelerated battery storage which is coming up is also going to help us to mitigate that issue. Of the existing asset which we have will be mitigated with this accelerated battery deployment, and the future, as we said, is the way we are working.

That's our strategy, and that's our way of working.

Right. Got it.

One more question just I wanted to clarify on one of the answers that you gave to Mohit, that in the tie-up with AESL as you call now, with the private player, in that, if there's a curtailment, and take-or-pay is to the extent of the unit that you are supplying, but if there's a curtailment, unlike a PPA, AESL would not pay you for that, right? The curtailment impact would come to your numbers, right?

No, I think let me clarify. It's a good thing you asked me, because I was getting a sense that it might be misunderstood or misconstrued in a manner.

What happens, Amit, when I have scheduled a power and it is not taken, then I am paid for it. This is the way the SECI pays me, the same terms and condition.

I am paid for that generation. There is also an element when I have scheduled the power and the grid says that, "You please back down," then I also get my payment for that what the grid has not taken because I have scheduled the power.

However, if I have not scheduled the power, then I will not be paid. Let's make life very clear on this matter, just I have been able to clarify to you as well as to Mohit in the past.

Everything which I have scheduled, whether it is with AESL or with anyone else, and if they say that they are not ready to take it, I will be paid for it. I am again repeating.

Anything I have scheduled, and the grid, because of their frequency changes, ask me to curtail, that also I am paid for. If I have not scheduled anything, of course, I will not be paid for.

Grid-related issue led curtailment is also impact to AESL and not to you?

No. See, Khavda suppose has X capacity of evacuation in totality.

That X capacity of evacuation which is available right now, which I will schedule to AESL, AESL will pay to us if they are not for any reasons whatsoever. AESL or any other party for that matter.

I'm not differentiating between AESL or any other party. Any party I schedule for whatever I am allowed to evacuate from Khavda, which I have scheduled considering what is a generation possible on that 15 minutes block.

You see, we schedule power on a 15 minutes block. In those 15 minutes block, whatever I have scheduled, if for any reason one of the procurer is not ready to take, I will be paid for.

If for any reason the grid ask me not to inject electrons in the grid, I will be paid for. Which is not possible to be scheduled, the procurer will not pay for.

Right. That's what, I'm to summarize, if the grid is not able to take the electrons that you are ready to supply, AESL takes the hit and not you?

For power which I have scheduled for.

Scheduled, but grid is not able to take it, still AESL takes the hit?

Yes. No, please understand.

I will give you an example here. Suppose I have the 1 GW of power which is available with me, right?

I may have 2 GW with me, but it is only possible to evacuate 1 GW of power. If I schedule that 1 GW of power to any procurer, it has been scheduled, and then if the procurer says no, I will be paid for it.

Correct.

Now your question is within that 1 GW which I have scheduled, procurer will pay.

Got it.

It's a bit technical, but I hope I have been able to clarify.

I'll just touch base with you later if required, any other clarifications on that.

Anytime.

Yeah. Thank you.

Those were

Sir. Thank you.

Sir, just to understand how much of this 10 GW, assuming the 10 GW is the closing capacity, 10 GWh is the closing capacity by the end of the year for batteries, how much of solar can it absorb? I'm just trying to understand just coming from that curtailment point, how much proportion of capacity that it can absorb?

Because the curtailment, I believe, for you gets impacted only during those few hours of the peak generation of solar. Say, for example, 10:00, 11:00, there would not be as much curtailment, again, say 4:00, 5:00, not as much.

In these few hours, I'm probably not able to get the number, my math is 2 to 2.5 GW of solar, but is that the right sense?

No, you are broadly right. See, the simplistic answer is you generally try and divide it by around

4.5 to 5. 4.5 to 5, okay.

Right?

Which is where 2 to 2.5 comes. Reality the equation is a bit more nuanced and complicated, because it depends on the curve of solar, the season, right?

Whether you have installed tracker-based plants or you have installed fixed tilt plants. That is a bit too complex, but as a rule of thumb, I think you can divide it by roughly 5.

By 5, okay. That comes to about 2 GW.

At least

2 GW 2 GW, yeah, 2. If it is a bit more curvy, then it could be even less, 4.5.

Very, very broad thumb rule roughly 5. All

right. Irrespective of the transmission availability, this much you can at least absorb and then sell it in whatever hours are available.

That's the purpose.

This is the kind of virtual transmission available through battery.

Yes. Got it.

Perfect. Sir, the second question is, your generation on a YoY basis is up about 33%, but your EBITDA is up about 51%.

I'm just wondering how is this happening? Is it because of the infirm power sales which is coming at a better price?

Dhruv, let me thank you that there is in this whole call there is someone who is also appreciating that good things have happened in that quarter and H1. Yes, it is.

It is also because of the better enumerations which we have got from them, right? Would you like to add more on this, Saurabh?

See, one is, Dhruv, that battery numbers are also now getting into that. Whatever the battery numbers, that gets added to it.

Secondly, what happens is that because of solar and wind combination, where wind projects wherever we have not yet done any kind of tie-ups are still going into merchant, and wind as a irradiation or this thing was also better this year because of rains being lower. The wind also has been much better than last year in that sense.

All this has impacted the EBITDA in that big way from the perspective of this thing. That's how it has been better even with whatever the capacities have been.

Plus we have brought in a lot of operational efficiencies also in our books, because if you will see our operating cost has not gone up as high as how the things have gone up. From an operational perspective also we have taken a lot of pains in terms of all manpower or other costs that we are taking.

See, whatever impact that can happen, we are reducing that impact by our O&M and employee cost and other things being more rationalized in that manner. Yeah?

I'll just like to add here, Dhruv, from the last few quarters we have been sharing with you all our investments on digitization, our investments on technology, our investments on how to do operations better. Now, all of this now you can see is being reflected on a better profits from the same operations which we have in the past, too.

While the revenue has increased because of various reasons which Saurabh clearly articulate well, these efforts, which are ongoing efforts to reduce our operating costs, to maximize all the returns possible, is now been also reflected in this EBITDA.

Got it. This is helpful, sir.

Sir, is it possible to share what is the average price at which you sold the infirm power this quarter and previous year same quarter?

Give me a minute. Do we have it right now?

On a infirm power basis, the last quarter to this quarter, basically because infirm sells in merchant, the merchant prices have been better this year. Against a merchant rate which was there on just give me a second, I'm giving you the exact numbers.

Just a second.

Do you have any other question right now while

No, sir, that's the only question. Or you can mention this later in the call.

We'll do. Thank you.

Sure, thank you, sir. Thanks

a lot. No, it has come there.

From our perspective, on a merchant basis, last year our number was nearer to about ₹2.1, and this year, because of the better this thing, our merchant rates have come to 2.4.

Got it. Yeah?

Great, sir. Thank you so much and all the best.

Thank you. Yes.

Yeah.

Thank you so much, sir. Just one additional clarification here.

You also have this 25-year fixed PPA with private players, which still last year was sold as merchant. If you can also give some color on what is the realization now versus what it was last year?

See, as I said just now, on a solar we were still earning even with a merchant capacities which are infirm power which is being sold as merchant, right now we are earning about 2.3, 4, sort of 2.4 that I said. In a solar capacity, for the PPA with AESL for 25 years, it's ₹2.70.

That way we are still better off on solar in that sense from the perspective of what we get a realization as. The larger thing which we should understand is that now for 25 years it's fixed.

We don't have to worry that this year again we are 2.4, next year again we might be 2.1, whatever. We are not trying to debate on that number.

For us, we are removing that kind of risk that we were carrying on merchant. We want to carry only one major risk, which is execution.

We are good at that, we want to execute better, we can do more efficient execution, we can do better operations, we can reduce our operating costs better. That is where we want to focus on.

We don't want to focus, and for us the capex that we have to do over the next 5, 7 years, which is more focused on us, where we want to remove any risk that the lender carries also on us and everything. From that perspective, just look at it that this is a 25 year for which we are not taking any merchant risk on our books.

We have completely

derisked our business

from that perspective. Yeah?

No, clearly understood, Mr. Shah, that yeah.

Right. Similarly, for the wind, what were the tariffs in merchant difference last year versus what is now contracted with Adani AESL?

See,

from a wind perspective, what happens is there are high wind seasons and low wind seasons. The overall annual rate of what wind generates, we have tied up all our PPAs based on that only.

If you will look at our business update which we had given after the Q1 call also, we have tied up wind at ₹3.93 for the 25-year period. Now, on a merchant basis, what happens is wind can be erratic, there can be any change which can happen on the prices because of that, that we are removing again.

Let's say on an average we got a ₹4 something last year on a wind, we have tied it up nearer to that in terms of, and we have to also look at benchmark PPAs that we have signed up on wind. From that perspective, we are ensuring our rate of return is what we get on wind also as well as solar also, which is 13%, 14% ROA, and we are tying it up for 25 years, we don't have to worry whether wind prices fall or go up during the seasonal nature of wind.

From that perspective, that's how we look at our business now, and that's how we want to do our business as well.

Okay. Great.

No, no, that's very, very clear, and I think it's a good strategy as well. My question is number one, first, you talked about 13% to 14%.

This is ROA or ROE? Second

ROA.

ROA.

Yes. ROE which is higher because we run on a 75/25% leverage basis,

yeah. Yeah.

In this ROA, you are essentially saying EBITDA divided by the asset, or EBIT?

EBITDA.

EBITDA, okay. 13% EBITDA divided by cost of asset.

Because depreciation is only 4% because it's a 30-year, 25, 30-year life, it doesn't make much of a difference, yeah. Correct,

correct. Understood.

Secondly, on the cost of borrowing, can you also talk about how much has your cost of borrowing changed in last 6 months, and also what is the impact that you see with now AG23L getting converted into AAA?

AG23L getting converted into AAA easily gives us a 15, 20 to 25 basis points of reduction that will come in that asset further. It was a AA+ entity, now it's a AAA.

Whatever notch-up increase, between 20 to 25 basis points are always on cards whenever we do this.

This is just for this 15% EBITDA, or entire portfolio?

Sorry?

25 bps reduction is on the portfolio, or just this asset?

No, this is on that asset. See, we cannot have that same asset being applied.

What it does is that this is 15% of my overall EBITDA. It also increases my profile with the rating agencies for the overall Adani Green perspective also.

Now see, this is a 7, 8-year, 10-year kind of a asset which was there. Similar such assets are now approaching a maturity where, because of the amortization structure that we have, we have a 20-year loan on this asset.

Based on the amortization structure, the profitability at PAT level for this asset is constantly going up because the loans are getting repaid, the asset is performing better than expected. All of this what it does is that it increases our profile.

Now that profile will be applied to all our other assets which are operating for more than 4 years, 5 years now. What it does is that it increases the overall AGEL profile.

See, in 2019 to 2026 today, in the last 5, 6 years, on an AGEL level also, our rating has gone up by five notches. That has impacted our interest cost where against a 11% average interest cost, we are at 8.9% today.

In the last 6 months also, we have remained between 8.95% to 8.9%, that is the difference that is there. We reported in March about 8.9%, we are saying we are at that same level along with a under construction of nearly 10 GWh of battery that has added to the interest rate profile.

See, if we are at a constant basis, then I can understand there is a question on interest, but with a under construction of nearly 10 GWh of battery, 5 GW of solar, wind that we are in the horizon, with that also our interest rates have remained at a level of 8.9%, which is generally a better achievement than which we could have got actually. Yeah?

Understood. Can you just last one from my side

Hi. The battery that we will commission, what portion of this 10 GWh will be tied up with AESL, and what portion will be tied up for the other hybrid and FDRE projects that we have?

I think Vishal, we answered this earlier, too. Let me reiterate if I was not clear on that part.

We, from our standpoint, is very clear on the parameters on which we are going to tie up, whether it's AESL

You will tie up 100%, I agree. I got that.

My question was more from how much of this 10 will go to AESL and how much to others is what I was trying to

Like I said, our parameters are clear. I think that there we were very clear with you that on these parameters, if AESL comes, then it is AESL.

If there is anyone else, then it is anyone else. For the timing it is In the past, it has been AESL, and that that is where we have tied up.

Once we tie up on the balance capacities, like we said that it is 3.5 which is already tied up, the rest of our 3.1, and our total of 6.6 as on December 30th is in the process. We will we will share it Sorry, September 30th is in the process.

We will share it across. That's we are always sharing across what we are doing.

Important factor again let me reiterate is the parameters on which fundamentally we are doing business, with respect to the organization rating, with respect to our return expectations. Those two are the critical parameters on which a company has to come forward with.

That's where we are.

Right. Just one more question.

Of the loans that we have, say, of the foreign borrowing that we have, the USD is hedged, but the interest rate is not hedged over there, right? When you say that's the 3-year there is sort of a stable rate, that is more for the domestic borrowing from the banks?

See, what happens is that this question was stemming from the fact that there is a rate hike in India that has happened. From that perspective, a very substantial portion, see, today anyway about 70% of our loan book is rupee-driven, right?

About 30% is in dollar-denominated. Within that 30% dollar-denominated, we fully hedge our principal plus interest anyway.

There is no change in that policy, because that's governed by the lender documents. It is not just our own

Hedging when you say principal

I'm just finishing. The hedging for, let's say, one of our RG2 assets has been done till FY '30.

It is fully hedged till FY '30. For a RG1, the hedging is done till 2028.

It will be now rolled over during a good window that we will get for another period of whatever three to See, in India, we get a hedging at a liquidity level of between three to five years, which is a good liquidity at which you get a good hedging rate also, and the hedging cost is not going beyond. That we will continue to maintain as our hedging policy, whether it is principal or interest.

It will not change for that. Yeah?

Thank you, sir.

Yeah. Thank you.

Good morning, team. Swetha here from Cantor on the line from New York.

I hope I am audible, and thank you

Can you be a bit louder, Swetha, if you don't mind?

Yeah. Of course.

I'm just glad that I'm audible. I'd be really quick.

Given the acceleration in the BESS deployment that you've seen in the first half, is there any change in the allocation or timing of the capex program that we have, the 2.4 lakh crore capex program? Specifically, would you direct it towards storage because we are accelerating the program, as you mentioned on the call, or on greenfield generation, which is I know we also have a target over there?

I think, Swetha, it's a good question. You will appreciate the fact that we have demonstrated so far our capabilities to very prudently deploy our capex at a scale which is also unprecedented.

We are very, very firm on that path. Under any circumstances, we don't foresee any challenge of not achieving it.

I think the point here is that what more we were going to do on that particular part. Of course, battery storage has come in this year, too.

There has been accelerated growth on that matter, and there is an opportunity to do that for the next few years, too. It is only going to add on to what we have been doing otherwise, or what we have planned otherwise.

In our overall strategy for next 3 to 5 years, both solar, wind, battery storage, and pump storage have their own roles to play, and we are firm on the debt as well as in the equity part, and more importantly, deploying that capex in a very prudent and cost-optimum manner.

Right. Thank you for sharing that.

Just another quick one on the leverage profile that we have, currently we are at 5.6. How should we think about peak leverage and peak cash flow generation, especially through FY '28?

I'm asking this question because we've seen evacuation being an issue, and you mentioned the EBITDA contribution and Vijil constantly tells us that, BESS is going to help us in making sure that we are on track with the run-rate EBITDA that we guide towards, but how do we frame the leverage profile?

See, on a long-term basis, that leverage profile does not change as such, because see, a curtailment is a issue which is there for not more than three, six months here and there. The change has not happened that it has been a year difference that we have given.

Whatever we had said that it will come by December is now slated to come nearer to March or something. That does not change a leverage profile of a asset which is like 25 years.

See, what happens is our leverage will be in this range till the time then we are nearer to FY '28, '29. After '29, '30, as the more and more operating assets starts to as a percentage of under construction asset, as we move towards that, the leverage profile will start to be in the range between 4.5 to 5, and then moving towards 4, and below 4 also as we move further into the number of years, because see, it's a amortization structure, it automatically pays for itself.

We have taken all loans on a project finance basis. The project are doing better.

All the projects which have been financed have been able to service their interest and repayment. From that perspective, as we move towards the larger capex being completed between '29, '30, and we will have about 45 GW of RE capacities, 5 GW of pump storage capacity, and nearer to 40, 50 GWh of batteries, that number on the overall EBITDA basis against which the debt that we want to deploy will be towards a number where it will reach a 4.5-ish number, and then it moves further down, because as you are paying off your debts, that number starts to taper off.

It does not have a larger impact of a curtailment, which will change the leverage profile in that big a way, because our leverages are based on project assets and not based on a change of three, six months here and there on any EBITDA profile. Yeah?

Right. Thank you, Saurabh.

I'll reach out offline for further questions. Thanks again.

Sure. Sure,

sure. Thank you.

Thank you. Thank you, and I like to thank each one of you for your continuous support to us.

On behalf of AGEL, I think we have been delivering a good performance and we'll keep on delivering the same. Once again, thank you for your perseverance, for your interest.

Thank you, Emkay, for organizing this, and we look forward to work further on in future. Thank you.

Thank you, everyone. Thank you.