adani transmission ltd Management discussions

Global economy

Overview: The global economic growth was estimated at a slower 3.2% in 2022, compared to 6% in 2021 (which was on a smaller base of 2020 on account of the pandemic effect). The relatively slow global growth of 2022 was marked by the Russian invasion of Ukraine, unprecedented inflation, pandemic-induced slowdown in China, higher interest rates, global liquidity squeeze and quantitative tightening by the US Federal Reserve.

The challenges of 2022 translated into moderated spending, disrupted trade and increased energy costs. Global inflation was 8.7% in 2022, among the highest in decades. US consumer prices increased about 6.5% in 2022, the highest in four decades. The Federal Reserve raised its benchmark interest rate to its highest in 15 years. The result is that the world ended in 2022 concerned that the following year would be even slower.

The global foreign direct investment (FDI) equity, reinvested earnings and other capital declined 24% in 2022, to nearly $1.28 trillion. Global trade expanded by 2.7% in 2022 (expected to slow to 1.7% in 2023). (Source: OECD, WTO data) The S&P GSCI TR(Global benchmark for commodity performance) fell from a peak of 4,319.55 in June 2022 to 3495.76 in December 2022. There was a decline in crude oil, natural gas, coal, lithium, lumber, cobalt, nickel and urea realisations. Brent crude oil dropped from a peak of around USD 120 per barrel in June 2022 to USD 80 per barrel at the end of the calendar year following the enhanced availability of low-cost Russian oil.

Regional growth (%)	2022	2021
World output	3.2	6.1
Advanced economies	2.5	5
Emerging and developing	3.8	6.3
economies

(Source: IMF, World Bank, UNCTAD)

Performance of major economies

United States: Reported GDP growth of 2.1% compared to 5.9% in 2021 China: GDP growth was 3% in 2022 compared to 8.1% in 2021 United Kingdom: GDP grew by 4.1% in 2022 compared to 7.6% in 2021

Japan: GDP grew 1.7% in 2022 compared to 1.6% in 2021 Germany: GDP grew 1.8% compared to 2.6% in 2021 [Source: PWC report, EY report, IMF data, OECD data]

Outlook

The global economy is expected to grow 2.8% in 2023, influenced by the ongoing Russia-Ukraine conflict. Concurrently, global inflation is projected to fall marginally to 7%. Despite these challenges, there are positive elements within the global economic landscape. The larger economies like China, the US, the European Union, India, Japan, the UK and South Korea are not in a recession. Approximately 70% of the global economy demonstrates resilience, with no major financial distress observed in large emerging economies. The energy shock in Europe did not result in a recession and significant developments, including Chinas progressive departure from its strict zero-covid policy and the resolution of the European energy crisis, fostered optimism for an improved global trade performance. Despite high inflation, the US economy demonstrated robust consumer demand in 2022. Driven by these positive factors, global inflation is likely to be still relatively high at 4.9% in 2024. Interestingly, even as the global economy is projected to grow less than 3% for the next five years,

India and China are projected to account for half the global growth (Source: IMF).

Indian economy

Overview: Even as the global conflict remained geographically distant from India, ripples comprised increased oil import bills, inflation, cautious government and a sluggish equity market. Indias economic growth was 7.2% in FY 2022-23. India emerged as the second fastest-growing G20 economy in FY 2022-23. India overtook UK to become the fifth-largest global economy. India surpassed China to become the worlds most populous nation (Source: IMF, World Bank)

Growth of the Indian economy

	FY 20	FY 21	FY 22	FY23
Real GDP growth(%)	3.7	-6.6%	9.1	7.2

Growth of the Indian economy quarter by quarter, FY 2022-23

	Q1	Q2	Q3	Q4
	FY23	FY23	FY23	FY23
Real GDP growth (%)	13.1	6.2	4.5	6.1

(Source: Budget FY24; Economy Projections, RBI projections)

According to the India Meteorological Department, the financial year 2023 delivered 8% higher rainfall over the long-period average. Due to unseasonal rains, Indias wheat harvest was expected to fall to around 102 million metric tons (MMT) in FY2022-23 from 107 MMT in the preceding year. Rice production at 132 million metric tons (MMT) was almost at par with the previous year. Pulses acreage grew to 31 million hectares from 28 million hectares. Due to a renewed focus, oilseed area increased by 7.31% from 102.36 lakh hectares in FY2021-22 to 109.84 lakh hectares in FY2022-23.

Indias auto industry grew 21% in FY23; passenger vehicle (UVs, cars and vans) retail sales touched a record 3.9 million units, crossing the previous high of 3.2 million units in FY19. The commercial vehicles segment grew by 33%. Two-wheeler sales fell to a seven-year low; the three-wheeler category grew 84%.

Till the end of Q3FY23, the banking systems total gross non-performing assets (NPAs) fell to 4.5% from 6.5% a year ago. Gross NPA for FY23 was expected to be 4.2% and a further drop is predicted to be 3.8% in FY2023-24.

As Indias domestic demand remained steady amidst a global slowdown, import growth in FY23 was estimated at 16.5% to $714 billion as against $613 billion in FY22. Indias merchandise exports were up 6% to $447 billion. Indias total exports (merchandise and services) grew 14 percent to a record of $775 billion and is expected to touch $900 billion in FY2023-24. Till Q3 FY23, Indias current account deficit, a crucial indicator of the countrys balance of payments position, decreased to $18.2 billion or 2.2% of GDP. Indias fiscaldeficit was in nominal terms at

~ Rs 17.55 lakh crore, which is 6.4% of the countrys GDP for the year ending March 31, 2023.

Indias headline foreign direct investment (FDI) numbers rose 20-to a record $84.8 billion in FY2021-

22, However, during the fiscal year 2022-23, the country experienced a 16% decrease in foreign direct investment (FDI) inflows, amounting to $71 billion on a gross basis. This decline can be attributed to the unfavourable global economic conditions and stands as the first contraction in FDI in the past ten years.

Indias foreign exchange reserves, which had witnessed three consecutive years of growth, experienced a decline of approximately $70 billion in FY2022-23, primarily influenced by rising inflation and interest rates. Starting from $606.47 billion on April 1, 2022, reserves decreased to $578.44 billion by March 31, 2023. The Indian currency also weakened during this period, with the exchange rate weakening from Rs. 75.91 to a US dollar to Rs. 82.34 by March 31, 2023, driven by a stronger dollar and an increasing current account deficit. Despite these factors, India continued to attract investable capital.

The countrys retail inflation, measured by the consumer price index (CPI), eased to 5.66% in March 2023. Inflation data on the Wholesale Price Index, WPI (calculates the overall price of goods before retail) eased to 1.3% during the period. In 2022, CPI hit its highest of 7.79% in April; WPI reached its highest of 15.88% in May 2022. By the close of the year under review, inflation had begun trending down and in April 2023 declined below 5%, its lowest in months. Indias total industrial output for FY23, as measured by the Index of Industrial Production or IIP, grew 5.1% year-on-year as against a growth of 11.4 % in FY2021-22.

India moved up in the Ease of Doing Business (EoDB) rankings from 100th in 2017 to 63rd in FY23. As of March 2023, Indias unemployment rate was 7.8 %. In FY2022-23, total receipts (other than borrowings) were estimated at 6.5% higher than the Budget estimates. Tax-GDP ratio was estimated to have improved by 11.1 % Y-o-Y in RE 2022-23. The government is also estimated to have addressed 77% of its disinvestment target in FY23 (Rs 50,000 crore against a target of Rs 65,000 crore).

The total gross collection for FY23 was Rs 18.10 lakh crore, an average of Rs 1.51 lakh a month and up 22% from FY22, Indias monthly goods and services tax (GST) collections hit the second highest ever in March 2023 to Rs. 1.6 lakh crore. For FY2022–23, the government collected Rs 16.61 lakh crore in direct taxes, according to data from the Finance Ministry. This amount was 17.6 % more than what was collected in the previous fiscal.

Per capita income almost doubled in nine years to USD 2,093 during the year under review, a rise of 15.8 percent over the previous year. Indias GDP per capita was USD 2,320 (March 2023), close to the magic figure of USD2500 when consumption spikes across countries. Despite headline inflation, private consumption in India witnessed continued momentum and was estimated to have grown 7.3 percent in 2022-23.

Outlook: There are green shoots of economic revival, marked by an increase in rural growth during the last quarter and an appreciable decline in consumer price index to less than 5 % in April 2023. India is expected to grow around 6-6.5 % in FY2024, catalysed in no small measure by the governments 35% capital expenditure. The growth could also be driven by broad-based credit expansion, better capacity utilisation and an improving trade deficit. Headline and core inflation could trend down. Private sector investments could revive. What provides optimism is that even as the global structural shifts are creating a wider berth for Indias exports, the country is making its largest infrastructure investment. This unprecedented investment is expected to translate into a robust building block that, going ahead, moderates logistics costs, facilitates a quicker transfer of products and empowers the country to become increasingly competitive. This can benefit Indias exports in general, benefitingseveral sectors.

The construction of national highways in 2022-23 was 10,993 kilometres; the Ministry of Road Transport and Highways awarded highway contracts of 12,375 km in the last financial year

The global landscape favours India: Europe is moving towards a probable recession, the US economy is slowing, Chinas GDP growth forecast of 4.4% is less than Indias GDP growth of 7.2% and America and Europe are experiencing their highest inflation in 40 years.

Indias production-linked incentive appears to be catalysing the downstream sectors. Inflation is steady.

India is at the cusp of making significant investments in various sectors and emerging as a suitable industrial supplement to China. India is poised to outpace Germany and Japan and emerge as the third-largest economy by the end of the decade. The outlook for private business investment remains positive despite an increase in interest rates. India is less exposed to Chinese economic weakness, with much less direct trade with China than many Asian peers.

Broad-based credit growth, improving capacity utilisation, the governments thrust on capital spending and infrastructure should bolster investment activity. According to our surveys, manufacturing, services, and infrastructure sector firms are optimistic about the business outlook. The downside risks are protracted geopolitical tensions, tightening global financial conditions and slowing external demand.

(Source: IMF data, RBI data, Union budget 2023-24 data, CRISIL report, Ministry of Trade & Commerce, NSO data)

Union Budget FY 2023-24 provisions

The Budget 2022-23 sought to lay the foundation for the future of the Indian economy by raising capital investment outlay by 33% to Rs. 10 lakh crores, equivalent to 3.3% of GDP and almost three times the 2019-20 outlay, through various projects like PM Gati-shakti, Inclusive Development, Productivity Enhancement & Investment, Sunrise Opportunities, Energy Transition and Climate Action, as well as Financing of Investments. An outlay of Rs. 5.94 lakh crore was made to the Ministry of Defence (13.18% of the total Budget outlay). An announcement of nearly Rs. 20,000 crores was made for the PM Gati-Shakti National Master Plan to catalyse the infrastructure sector. An outlay of Rs. 1.97 lakh crore was announced for Production Linked Incentive schemes across 13 sectors. The Indian government intends to accelerate road construction in FY24 by 16-21% to 12,000-12,500 km. The overall road construction project pipeline remains robust at 55,000 km across various execution stages. These realities indicate that a structural shift is underway that could strengthen Indias positioning as a long-term provider of manufactured products and its emergence as a credible global supplier of goods and services

Global power sector overview

The global electricity demand is expected to increase by 2.4% in 2022, which is lower than the January forecast of 3%.The growth rate is expected to remain steady in 2023. This is a decrease from the 6% rise seen in 2021 but in line with -year average five the before the COVID-19 pandemic. Renewable energy sources, specifically wind and solar power, were able to fulfill 77% of this increased demand, while the remaining portion was met by hydro power. China, the US, and India saw varying levels of success in meeting their increased demand for electricity with wind and solar power. Specifically, China was able to meet 92% of its electricity demand increase with wind and solar power, the US with 81%, and India with 23%.

The global power generation market size is expected to reach $2,462.37 billion in 2026 and it is expected to grow at a CAGR of 10.1% to reach $3,982.36 billion in 2031.

The demand for electricity in China is expected to increase significantly, with the country accounting for a third of global electricity demand by 2025. This is a substantial increase from its 5% share in 1990 and 25% share in 2015. With the strong growth of electricity demand in other parts of Asia, the region is expected to make up more than 50% of the worlds electricity demand by 2025.

The use of wind and solar energy has experienced a significant increase, exceeding 5% of global electricity production since 2015, and has more than doubled since then. For thefirsttime, the combined output of solar panels and wind turbines has exceeded that of all nuclear power plants worldwide. In contrast, the proportion of nuclear energy used in global electricity production has remained relatively stable due to the lack of new plant construction outside of China and the closure of older nuclear plants in OECD countries. (Source: Hindustan Times)

Indian power sector overview

In the fiscal year 2022-23, India witnessed a 9.5 percent year-on-year increase in power consumption, reachingatotalof1,503.65billionunits.Comparatively, the power consumption in the previous fiscal year,

2021-22, stood at 1,374.02 billion units (BU).

India has one of the worlds most diverse power sectors, which is both extensive and intricate. The country utilizes a variety of power generation sources, including traditional sources such as coal, lignite, natural gas, oil, hydro, and nuclear power, as well as sustainable non-conventional sources like wind, solar, and even agricultural and domestic waste.

Over the past few decades, India has undergone significant changes in its power sector. Nearly all citizens have access to grid electricity, power deficiencies have decreased, and renewable energy capacity has grown to comprise a quarter of the countrys overall capacity. In order to address the growing demand for electricity, there is a pressing need to augment installed generating capacity. According to a 2018 index that evaluated the overall power of

25 nations in the Asia-Pacific region, fourth, fifth, and fifth in wind, solar, and renewable power installed capacity, respectively. Additionally, the country was the sixth-highest investor in clean energy, with an investment of US$90 billion. As of 2018, India was the only G20 nation on track to meet its Paris Agreement targets. As of October 31, 2022, India has an installed power capacity of 408.71 gigawatts (GW), making it the third-largest producer and consumer of electricity globally.

(Source: PIB, IBEF, CEA)

Indias per capita power consumption

Countries Per capita electricity	India	China	USA	France	Japan
consumption in kWh (2022)	1255	5331	4437	6977	7190

(Source: Statista, PIB)

Indias power generation

Year	FY 2017- 18	FY 2018- 19	FY 2019- 20	FY 2020- 21	FY 2021- 22	FY 2022- 23
Power generation (in billion units)	1308.1	1376.1	1389.1	1381.8	1491.8	1624.2

*Upto March 2023 (Provisional), Source: CEA

India is projected to have a surplus of energy amounting to 2.9%, as well as a peak surplus of 3.4%. for FY2022-23 according to Central Electricity Authority. During 2022-23, the western, southern, eastern, and northeastern regions of India are anticipated to experience energy surpluses of 6.3%, 4.1%, 1.3%, and 15.4%, respectively. Only the northern region is predicted to encounter a deficit of 1.2%, which could be compensated by surplus power from other regions.

The Central Electricity Authority (CEA) is expecting an additional 8,970 megawatts (MW) of power capacity to be installed during the year. This includes 6,210 MW of thermal, 2,060 MW of hydropower and 700 MW of nuclear capacity. In FY 2022-23, the Ministry of Power has sanctioned a gross generation program of 1,644 billion units (BU), which is equivalent to 77% of the overall generation. Renewable energy sources are estimated to generate 184 BU or 11% of the total generation, while hydropower and nuclear will account for 150.66 BU and 43.33 BU of power generation, respectively, during 2022-23.

The Indian power sector is experiencing significant changes that are redefining the industrys outlook.

The growing demand for electricity in India is being propelled by sustained economic growth, and in the coming years, a rising number of Indian households are expected to acquire appliances, air conditioning units, and vehicles. The country is adding electricity capacity equivalent to that of Los Angeles each year to power its urban population. The governments ‘Power for All initiative has stimulated capacity expansion, but competition is intensifying on both the market and supply sides, including fuel, logistics, finances, and manpower.

(Source: IBEF, CEA, Ministry of Power)

Outlook

The Indian power sector is experiencing significant changes that are redefining the industrys outlook.

The future of the power industry in India appears bright, with sustained economic growth continuing to drive demand for electricity. The governments ‘Power for All initiative has accelerated capacity expansion in the country. By 2026-27, it is anticipated that Indias installed power generation capacity will reach nearly 620 GW, with renewable energy sources accounting for 44% and coal accounting for 38% of the capacity.

Indian power transmission sector overview

India has often faced a situation where its power transmission capacity has not kept up with its power generation capacity. However, in recent times, there has been a growing push to expand Indias transmission network in order to keep pace with rising electricity generation, escalating demand for electricity, and the development of new urban and semi-urban areas, as well as the emergence of new electricity generation locations, particularly in the renewable energy sector.

India has added 14,625 circuit kilometers and 75,902

MVA of new transformation capacity in the fiscal year

2022-23. However, the power transmission sector will require even greater capacity to effectively transmit power from regions with high levels of renewable energy to the rest of the country. To this end, grid digitalization will be crucial in enabling the bidirectional flow of both information and power. Moreover, the deployment of utility-scale energy storage, which can act as both a source and a sink of power, could greatly enhance system flexibility. India has set ambitious targets to reduce the carbon intensity of its economy by over 45% by the end of this decade, achieve 50% of its cumulative electric power from renewables by 2030, and achieve net-zero carbon emissions by 2070. To achieve these goals, Indias national transmission grid needs to be significantly upgraded to support the widespread adoption of renewable energy. India has abundant renewable energy resources that are unevenly distributed across the country. To meet the demand from states with limited renewable energy resources, a broadening of the national transmission network was necessary, and this has been validated in practice. However, to ensure a balance between the intermittent nature of renewable energy and consistent power supply, robust interstate grid connectivity and effective electricity storage are also required. The complexities of Indias grid demonstrate that a lack of transmission network infrastructure could hinder the adoption of renewable energy, and there is an increasing risk that renewable energy utilization could be suboptimal without proper grid discipline and a modern transmission network.

The transmission sector in India is becoming more competitive, which is expected to lead to increased renewable energy generation without these assets becoming scattered. The growing involvement of new transmission players is helping to reduce construction costs, introduce updated technologies, and encourage the timely completion of projects. This has also increased the countrys access to global debt and equity. Additionally, the higher valuation of some transmission companies is evidence of the way in which a supportive regulatory framework can attract capital investment for transforming Indias electricity system. The private sector is playing a critical role by investing significant capital at a low cost in the creation of transmission networks, taking advantage of record-low global interest rates, reduced risk, and extended infrastructure yields. This approach will also free up finite resources of state governments that can now be allocated to strengthening other social sectors such as health or education.

With substantial transmission planning and investment in renewable energy, many Indian states have the potential to transform from being net electricity importers to net exporters of low-cost, zero-pollution, and zero-emission electricity. Furthermore, ambitious distributed hybrid projects that efficiently utilize the transmission network are expected to reduce transmission tariffs as the costs will be spread across an increasing stream of energy units.

(Sources: IEEFA, PV magazine, Ministry of Power)

Indias transmission line capacity addition

Year	FY 2018- 19	FY 2019- 20	FY 2020- 21	FY 2021- 22	FY 2022- 23
Cumulative capacity (in circuit kilometers)	4,13,407	4,25,071	4,41,821	4,56,716	4,71,341

*Up to March 2023 (Source: powermin.gov)

Indias transformation capacity addition

Year	FY 2018- 19	FY 2019- 20	FY 2020- 21	FY 2021- 22	FY 2022- 23
Cumulative capacity (in MVA)	8,99,663	9,67,893	10,25,468	10,04,450	11,80,352

*Up to March 2023 (Source: powermin.gov)

Government initiatives

Revamped Distribution Sector Scheme (RDSS) - The Revamped Distribution Sector Scheme has been approved by the Cabinet Committee on Economic Affairs, with an allocation of Rs.3,03,758 crore and a gross budgetary support of Rs.97,631 crore from the Indian government over a five-year period from

FY 2021-22 to FY 2025-26. This reforms-based and results-linked scheme aims to reduce the Aggregate Technical and Commercial (AT&C) losses to levels of 12-15% across India and eliminate the gap between Average Cost of Supply (ACS) and Average Revenue Realized (ARR) by 2024-25.

Ujjwal Discom Assurance Yojna (UDAY) - Launched in November 2015, UDAY is a scheme aimed at improving the operational and financial efficiency of

State Power Distribution Companies (DISCOMs) in India. DISCOMs in the country have been struggling to eliminate the gap between the average cost of supply and realized revenue (ACS-ARR gap). Through the Ujjwal Discom Assurance Yojana (UDAY), financial recovery is expected for the DISCOMs.

24x7 - Power for All - The initiative to provide 24x7 power to all households, industries, commercial businesses, public needs, and other electricity-consuming entities, as well as adequate power to agricultural farm holdings, is a joint initiative of the Government of India (GoI) and state governments. DeenDayal Upadhyaya Gram Jyoti Yojana (DDUGJY): The Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY) is a flagship program of the Ministry of Power and a key initiative of the Government of India aimed at providing uninterrupted power supply to rural India, including village electrification. The scheme is designed to benefit rural households by providing access to electricity, which is essential for the growth and development of the country.

Integrated Power Development Scheme (IPDS): In December 2014, the Ministry of Power in the Indian government introduced the Integrated Power Development Scheme (IPDS) to strengthen power sub-transmission and distribution networks in urban areas. The scheme aims to reinforce sub-transmission and distribution networks, improve metering of distribution transformers, feeders, and consumers, enable Enterprise Resource Planning (ERP) and IT infrastructure in urban towns, and implement Real-Time Data Acquisition System (RT-DAS) projects. As of November 2021, projects worth Rs. 30,904 crores were sanctioned under IPDS, and a grant of Rs.16,478 has been released. Additionally, distribution system reinforcement projects have been completed in 524 circles.

Pradhan Mantri Sahaj Bijli Har Ghar Yojana : The Pradhan Mantri Sahaj Bijli Har Ghar Yojana is a government project in India that aims to provide electricity to all households. It was announced by Prime Minister Narendra Modi in September 2017 with a target of completing the electrificationprocess by December 2018. Eligible households identified via the Socio-economic and Caste Census (SECC) of 2011 will receive free electricity connections, while others will be charged Rs. 500. The project has a total outlay of Rs. 16,320 crores with a Gross Budgetary Support (GBS) of Rs. 12,320 crores. The scheme includes the provision of five LED lights, one AC fan, and one AC power plug to each beneficiary household, along with Repair and Maintenance (R&M) for five years. The government has also launched a website, saubhagya. gov.in, to disseminate information about the scheme. Budget allocation: The solar power sector has received a boost in the Union Budget for 2023-24, with a budgetary allocation of Rs 7,327 crore, a 48 per cent increase over the previous allocation of Rs 4,979 crore. The budget allocates Rs 4,970 crore for grid-interactive solar power projects, Rs 1,996 crore for the PM-KUSUM project, and Rs 361 crore for off-grid solar power projects, according to the Expenditure Budget document for 2023-24. The Phase-III of the off-grid solar PV programme includes plans to install 300,000 solar streetlights, distribute 2.5 million solar study lamps, and install solar power packs with a total aggregated capacity of 100 MWp. The AJAY Phase-II scheme will see the installation of over 300,000 solar streetlights. Additionally, there are plans to undertake 20 MW projects of concentrated solar thermal. The allocation for wind energy projects in the current financial year is Rs. 1,214 crores, which is a 14% decrease from the previously allocated Rs. 1,413 crores as per the revised estimates. (Source: Economic Times) National Green Hydrogen Mission: The National Green Hydrogen Mission was approved by the Union Cabinet on January 4, 2023, with the objective of achieving a green hydrogen production capacity of at least 5 million metric tonnes (mmt) and an associated renewable energy capacity addition of around 125 gigawatts (GW) by 2030. The aim of the mission is to reduce nearly 50 MMT of greenhouse gas emissions annually by 2030 through the promotion of demand creation, production, and utilization of green hydrogen across various sectors. (Source: www.downtoearth. org.in)

Growth drivers

Growing population: India has overtaken China as the worlds most populous country. Further, Indias population is expected to continue to grow and reach 1.52 billion by 2036, which will result in an increased need for power transmission infrastructure in the country.

Urbanisation: As the population of the country is expected to increase, there is also an anticipated rise in the urban population. By 2030, it is expected that the urban population in India will reach 600 million, which will account for 40% of the total population.

Renewable energy targets: The urgent need to address climate change at a global level is a significant concern for India. While Indias greenhouse gas emissions are relatively small compared to the rest of the world, its contribution to the issue has become increasingly important. In response, India has set a target of achieving 500 GW of renewable energy capacity by 2030 and improving its energy efficiency.

This ambitious goal reflects Indias commitment to addressing climate change and reducing its carbon footprint.

Green Energy Corridors: The Indian government has launched two schemes, namely the Green Energy Corridor I and Green Energy Corridor II, to develop highways for renewable power transmission. These projects implemented upgraded technologies and systems to enhance grid stability. To improve power quality, the country employed Static Var Compensators (SVCs) and Static Synchronous Compensators (STATCOMs) to ensure stabilized voltage levels and increase the power transfer capability of the transmission lines.

Growing inter-regional demand-supply gap: As load centers are situated far away from conventional power generation centers, the gap between demand and supply is increasing in various regions.

Legacy infrastructure: To keep up with ongoing trends and replace legacy infrastructure, India - the second largest market for transmission infrastructure after China - needs to install new transmission and distribution infrastructure.

Growing private sector investments: The Indian power sector has experienced a significant change due to the increasing private sector investments, which are estimated to be just fewer than 50%.

(Source: The wire, IEA, Economic Times, Livemint, India Today)

Financial overview

Operational revenues: During FY2022-23, operational revenue stood at Rs.12,149 crores as against Rs. 10,184 crores in FY2021-22.

Interest and finance costs: Net interest and finance costs increased by 27% in FY2022-23. reported a profit after Profit tax of Rs.1,281 Crore in FY2022-23 compared to Rs. 1,236 Crore in the preceding year.

Key ratios

Particulars	2022-23	2021-22
Debt-equity ratio	2.68	2.71
Return on equity/Net worth (%)	10.78	11.75
Book value per share (Rs.)	114.39	72.29
Earnings per share (Rs.)	11.10	8.9

Company overview

Adani Group made its entry into the power transmission segment in 2006, prior to the establishment of Adani Transmission Limited (ATL). The primary reason behind the formation of ATL was to meet the power evacuation needs of Adanis Mundra thermal power plant. The power transmission lines installed for this purpose covered over 3,800 circuit kilometers, connecting Mundra to Dehgam, Mundra to Mahendragarh, and Tiroda to Warora. As the demand for power transmission continued to grow, Adani Transmission Limited (ATL) saw opportunities for expansion and was formally established in 2015 as a separate entity carved out from Adani Enterprises Limited (AEL). ATL pursued various growth strategies including acquiring existing transmission assets, such as GMRs transmission assets in Rajasthan in 2016, Reliance Infrastructures transmission assets in Gujarat, Madhya Pradesh, and Maharashtra in 2017, and KECs Bikaner-Sikar transmission asset in Rajasthan in 2019. In 2014, ATL had already conceived a new transmission line extending over 1200 ckm from Adanis Tiroda power plant to meet growing demand. The companys initial foray into power transmission had been prompted by the power evacuation requirements of Adanis Mundra thermal power plant, and the resulting development of transmission lines spanning more than 3,800 ckm with connections to various locations.

Adani Transmission Limited (ATL) expanded its presence in the power distribution sector by acquiring Reliance Infrastructures power generation, transmission, and distribution business in August 2018. Adani Electricity Mumbai Limited currently has a distribution network covering over 400 square kilometers and serves over 12 million consumers in Mumbai suburbs and Thane district. ATL is the largest private transmission company in India, with a portfolio of around 19,779 circuit kilometers of transmission lines and more than 46,001 MVA of power transmission capacity. The company has set an ambitious target of owning 30,000 circuit kilometers of transmission assets by 2030.

Operating history

ATL earned incentive payments for maintaining network availability above regulatory requirements, i.e., average availability of 99.7% in FY23.

?500 kV Mundra - Mahendragarh
HVDC Transmission System (ATIL
- Asset-1 HVDC)
(%) Availability
FY21	97.50	99.29	1.79
FY22	97.50	96.42	(1.08)
FY23	97.50	99.96	2.46
	Normative	Actual
	Above normative

?500 kV Mundra-Mahendragarh
HVAC Transmission System (ATIL
Asset-1 HVAC)
(%) Availability
FY21	98.50	99.96	1.46
FY22	98.50	99.98	1.48
FY23	98.50	99.87	1.37
	Normative	Actual
	Above normative

400 kV Mundra-Sami-Dehgam
Transmission System (ATIL -
Asset 2 HVAC)
(%) Availability
FY21	98.50	99.85	1.35
FY22	98.50	99.78	1.28
FY23	98.50	99.64	1.14
	Normative	Actual
	Above normative

400 kV Tiroda-Warora
Transmission System (ATIL - TW)
(%) Availability
FY21	98.00	99.87	1.87
FY22	98.00	99.81	1.81
FY23	98.00	99.88	1.88
	Normative	Actual
	Above normative

Maharashtra Eastern Grid Power
Transmission company Limited
(MEGPTCL)
(%) Availability
FY21	98.5	99.95	1.45
FY22	98.5	99.96	1.46
FY23	98.5	99.85	1.35
	Normative	Actual
	Above normative

Chhattisgarh-Western Region
Transmission Limited (CWRTL)
(%) Availability
FY21	98.00	99.96	1.96
FY22	98.00	99.93	1.93
FY23	98.00	99.94	1.94
	Normative	Actual
	Above normative

Raipur-Rajnandgaon-Warora
Transmission Ltd. (RRWTL)
(%) Availability
FY21	98.00	99.91	1.91
FY22	98.00	99.93	1.93
FY23	98.00	99.75	1.75
	Normative	Actual
	Above normative

Sipat Transmission Ltd. (STL)
(%) Availability
FY21	98.00	99.91	1.91
FY22	98.00	99.86	1.86
FY23	98.00	99.66	1.66
	Normative	Actual
	Above normative

Western Transmission (Gujarat)
Ltd. (WTGL)
(%) Availability
FY21	98.00	99.76	1.76
FY22	98.00	99.73	1.73
FY23	98.00	99.75	1.75
	Normative	Actual
	Above normative

Western Transco Power Ltd.
(WTPL)
(%) Availability
FY21	98.00	99.93	1.93
FY22	98.00	99.86	1.86
FY23	98.00	99.89	1.89
	Normative	Actual
	Above normative

Adani Transmission Bikaner Sikar
Private Ltd. (ATBSPL)
(%) Availability
FY21	98.00	100.00	2.00
FY22	98.00	99.97	1.97
FY23	98.00	100.00	2.00
	Normative	Actual
	Above normative

Adani Transmission (Rajasthan)
Ltd. (ATRL)
(%) Availability
FY21	99.00	99.95	0.95
FY22	98.00	99.84	1.84
FY23	98.00	99.96	1.96
	Normative	Actual
	Above normative

Aravali Transmission Service
Company Ltd. (ATSCL)
(%) Availability
FY21	98.00	99.96	1.96
FY22	98.00	99.85	1.85
FY23	98.00	99.75	1.75
	Normative	Actual
	Above normative

Maru Transmission Service
Company Ltd. (MTSCL)
(%) Availability
FY21	98.00	99.91	1.91
FY22	98.00	99.92	1.92
FY23	98.00	99.97	1.97
	Normative	Actual
	Above normative

Alipurduar Transmission Ltd.
(ATL)
(%) Availability
FY22	98.00	99.97	1.97
FY23	98.00	99.98	1.98
	Normative	Actual
	Above normative

Warora Kurnool Transmission
Limited (WKTL)
(Partially operational)
(%) Availability
FY22	98.00	99.92	1.92
FY23	98.00	100.00	2.00
	Normative	Actual
	Above normative

Ghatampur Transmission Limited
(GTL)
(%) Availability
FY22	98.00	99.59	1.59
FY23	98.00	98.27	0.27
	Normative	Actual
	Above normative

Obra - C Badaun Transmission
Limited (OCBTL)
(%) Availability
FY22	98.50 99.29	0.79
FY23	98.50 99.51	1.01
	Normative Actual
	Above normative

Fatehgarh Bhadla Transmission
Limited (FBTL)
(%) Availability
FY22	98.00	99.97	1.97
FY23	98.00	100.00	2.00
	Normative	Actual
	Above normative

North Karanpura Transco Limited
(NKTL) nset -
(partially operational)
(%) Availability
FY22	98.00	99.58	1.58
FY23	98.00	99.96	1.96
	Normative	Actual
	Above normative

Bikaner-Khetri Transmission
Limited (BKTL)
(%) Availability
FY22	98.00	99.80	1.80
FY23	98.00	98.48	0.48
	Normative	Actual
	Above normative

PPP-8 Hadoti Power Transmission
Service Ltd. (HPTSL)
(%) Availability
FY21	98.00	99.88	1.88
FY22	98.00	99.90	1.90
FY23	98.00	99.86	1.86
	Normative	Actual
	Above normative

PPP-9 Barmer Power Transmission
Service Ltd. (BPTSL)
(%) Availability
FY21	98.00	99.89	1.89
FY22	98.00	99.88	1.88
FY23	98.00	99.85	1.85
	Normative	Actual
	Above normative

PPP-10 Thar Power Transmission
Service Ltd. (TPTSL)
(%) Availability
FY21	98.00	99.91	1.91
FY22	98.00	99.87	1.87
FY23	98.00	99.87	1.87
	Normative	Actual
	Above normative

Jam khambhaliya Transco Limited
(JKTL)
(%) Availability
FY23	98.00	99.99	1.99
	Normative	Actual
	Above normative

Lakadia Banaskantha Transco
Limited (LBTL)
(%) Availability
FY23	98.00	99.19	1.19
	Normative	Actual
	Above normative

WRSS XXI (A) Transco Limited
(WTL)
(%) Availability
FY23	98.00	99.87	1.87
	Normative	Actual
	Above normative

Details of Significant Changes in the Key Financial Ratios and

Pursuant to amendment made in Schedule V to the Listing Regulations, details of significant change of 25% or more as compared to the immediately previous financial year) in Key Financial Ratios and any changes in Return on Net Worth of the Company (on standalone basis) including explanations are included as per note no. 48 forming part of the standalone financial statements

Human resources

ATLs market leadership was reinforced by its human resource practices. The company invested in both formal and informal training, as well as on-the-job learning. It emphasized employee engagement by providing an enriched workplace, challenging job profiles, and regular dialogues with management. The company has one of the highest employee retention rates in the industry, creating leaders from within and strengthening its prospects. As of March 31, 2023, the company had 5,002 permanent employees on a consolidated basis.

Internal control systems and their adequacy

AdaniTransmissionLimited(ATL)hadeffectiveinternal control procedures in place that were appropriate for its size and operations. The Board of Directors was responsible for the internal control system and ensured that it was adequate, effective, and applied properly. The Companys internal control system was designed to ensure management efficiency, measurability, and verifiability, reliable accounting and management information, compliance with all applicable laws and regulations, and the protection of the Companys assets. This was done to promptly identify and manage the risks faced by the Company, including operational, compliance-related, economic, and financial

Cautionary statement

This statement made in this section describes the Companys objectives, projections, expectation and estimations which may be ‘forward-looking statements within the meaning of applicable securities laws and regulations.