Dear Unitholders,
It gives me immense pleasure to present to you this year's annual
report as it has been a transformational year for IndiGrid. Steadfast trust of our
stakeholders has enabled us to achieve unmatched feats in the sector and record a ~24%
year-on-year rise in our Assets Under Management (AUM) while delivering consistent DPU
growth. With our aim to contribute significantly to India's energy transition vision, we
are strengthening the grid that ensures seamless delivery of renewable energy, operating
renewable energy projects and building battery energy storage systems.
Value Accretive Moves
During the year, we made significant strides across our portfolio. We
successfully delivered growth through both inorganic and organic moves across
transmission, solar and battery energy projects.
Significant addition in Renewable Energy Capacity
We consummated two large acquisitions in renewable energy space which
helped us increase our portfolio capacity from 138 MWp (DC) to ~1.1 GWp (DC). We
consummated a landmark deal in the first half of the year by acquiring Virescent Renewable
Energy Trust (VRET) which added 538 MWp (DC) of generation capacity to our portfolio. This
transaction was one of its kind as it was the first and only deal in the country (till
date) when an InvIT acquired another InvIT.
In the later part of the fiscal, we acquired a 420 MWp (DC) solar
project, ReNew Solar Urja Private Limited (RSUPL), which is in the high irradiation region
of Jaiselmer, Rajasthan from ReNew. RSUPL is another strategic addition to our portfolio
providing us access to high quality generation assets with exposure to central
counter-parties.
Expansion in Greenfield transmission projects
IndiGrid commissioned its first green field project, Kallam
Transmission Limited (KTL), in last quarter of FY 2023-24. With presence across India and
strong team from the transmission industry, IndiGrid has been able to reap benefits of
operational leverage to bid for projects at competitive tariffs. We have won three
greenfield ISTS transmission projects, Ishanagar Power Transmission Limited (IPTL), Dhule
Power Transmission Limited (DPTL), and Kallam Transco Limited (KTCO) that will contribute
~INR 1,300 Crores of AUM in coming years. These projects will be
developed on BOOT basis over a period of ~24 months and have a concession period of 35
years after commencing commercial operations. We believe that with unprecedented pipeline
of transmission projects, coupled with our strong team and geographical footprint,
expansion in greenfield transmission projects will continue to fuel growth for IndiGrid in
coming years.
Our newest foray - Battery Energy Storage Systems (BESS)
Over the last few years, globally, Renewable Energy (RE) has taken
centre stage and the scenario in India is no different. With the focus on reducing the
country's carbon footprint, need of installed RE capacities is on the rise, and to counter
its intermittent nature, Battery Energy Storage Systems (BESS) have also gained momentum.
Akin to Transmission Service Agreements (TSA), under Battery Energy
Storage Purchase Agreements (BESPA) the service provider is compensated based on ensured
system availability and not actual utilisation by the user - hence reducing the risk
quotient for the service provider. Thus, this ties in well with IndiGrid's risk averse
portfolio strategy.
IndiGrid successfully forayed into this space during FY 2023-24 winning
India's first utility scale standalone battery energy storage system project awarded by
BSES Rajdhani Power Limited (BRPL) - one of the largest discoms in Delhi. This project is
for the Design, Supply, Testing, Installation, Commissioning, Operation and Maintenance of
a 20 MW/ 40 MWh BESS in Delhi. Post the first success, IndiGrid also won a 180 MW / 360
MWh BESS project awarded by Gujarat Urja Vikas Nigam Limited (GUVNL), by emerging as the
second lowest bidder in the reverse auction process.
Pathway to Growth
IndiGrid closed the fiscal with an AUM of INR 283 Billion, a growth of
24% year-on-year. While we continued our acquisitive run through the year, we also raised
~INR 1,072 crores in equity to maintain enough runway for our future growth. Of the ~INR
1,072 crores, we raised ~INR 403 crores through preferential allotment and ~INR 669 crores
through institutional placement. Consequently, we clocked a net debt to AUM of 62.4% by
fiscal end, leaving significant headroom for growth.
For the year, IndiGrid's Revenue from Operations and EBITDA grew by 23%
and 17%, respectively. Our NDCF for the entire year was at INR 1,244 crores, marking a
year-on- year growth of 20%. On back on our accretive acquisitions, we delivered on our
DPU guidance of INR 14.1 per unit for FY 2023-24, which we had increased mid-year, and
have guided for distribution of INR 15.0 per unit for FY 2024-25, a growth of over 6%
year-on-year.
IndiGrid's robust balance sheet maintenance practices, prudent asset
management processes, and an operational excellence mindset have resulted in our
consistent growth and achievements.
An Operational Excellence Mindset
Over the past few years, we have enhanced the reliability of our
network through various digital interventions. For FY 2023-24, for our transmission assets
we achieved an average availability of 99.76% and trips per line of 0.16. The plant
availability across all our solar assets was at 99.32%. Our teams have diligently worked
towards fostering a preventive culture, moving away from a reactive towards a predictive
approach to avoid unexpected downtimes.
Technology has been pivotal in driving our efforts, as we have
implemented a range of digital tools to create a future-ready ecosystem. Over the last few
years, we had deployed DigiGrid, our cutting-edge digital platform, across all our
portfolio assets which has equipped our teams at all levels to monitor the performance of
each asset element consistently and remotely, ensuring adherence to the highest standards
of Quality, Health, Safety, and other operational requirements. Our investments in
Emergency Restoration System (ERS), predictive weather intelligence platforms, drone-based
inspections, and robotic solar module cleanings have also enhanced our operational
efficiency and asset reliability.
Our primary goal remains to schedule maintenance precisely when it's
most necessary, based on real-time equipment performance. By adopting this approach, we
anticipate higher efficiency in our asset management efforts even as our portfolio size
gains new heights.
ESG - A Way of Life
Maintaining the highest standards of Environment, Social and Governance
(ESG) practices has been a habit for everyone at IndiGrid. As the organisation matures,
our teams have identified specific target areas to align all our efforts under the gamut
of E, S, and G. We have taken significant steps to integrate eco-friendly practices
throughout our operations. By prioritising renewable energy and resource conservation, we
are reducing our environmental footprint and contributing to the fight against climate
change. Our efforts are not just about compliance but about cultivating a culture of
sustainability that permeates every level of our organisation.
Recognising the significance of enhancing Diversity, Equity, and
Inclusion (DE&I), we had launched our DE&I policy during FY 2022-23. We hired our
second batch of all female Graduate Engineer Trainees (GETs) during the year who, post
training, have been deployed across our project sites. By the end of the fiscal, IndiGrid
has achieved a gender diversity of 25.3% in corporate roles, and we are committed of
improving this ratio year-on-year.
We continued to enhance our health and safety practices through
rigorous training programs, regular safety audits, and the implementation of
state-of-the-art safety technologies. Our approach to health and safety is proactive and
preventive and our initiatives are designed to not only meet but exceed industry
standards, ensuring that our workplace is one where everyone can perform their best
without compromising on safety.
We believe that the Indian power sector stands at a pivotal juncture,
poised for transformative growth. With rising energy demands, ambitious renewable energy
targets, and significant investments in grid modernisation, we are set to achieve
unparalleled progress. Our commitment to enhancing transmission infrastructure,
integrating smart technologies, and supporting sustainable energy initiatives will drive
this evolution. As we navigate these opportunities, our focus remains on delivering power
reliably across regions and stakeholders while providing superior risk-adjusted returns to
our unitholders.
In closing, I would like to extend my heartfelt gratitude to our valued
unitholders for their support and partnership with IndiGrid. Thanks to their dedication
and invaluable guidance, we have successfully navigated the ups and downs experienced in
the past eight years. As we embark on our next phase of growth, we are committed to
strengthening these relationships further.
Warm Regards,
| Harsh Shah, |
| Chief Executive Officer |