ge td india ltd Management discussions

In the fiscal year 2022-23, the Russia-Ukraine war continued to impact the markets. Although the impact on the supply chain was reduced compared to the previous year, it was not completely mitigated. The supply chain continues to exert pressure on global energy market price points.

Green Energy Corridor (GEC)

The Green Energy Corridor (GEC) was launched by the Government of India to establish a transmission grid for power generation from renewable sources and integrate it with the national grid. The project was initially launched in 2015-16, and since then, substantial growth in grid capacity has been observed every year with the commissioning of additional Green Energy Corridors. These corridors include intrastate, inter-state, and inter-regional linkages.

The transmission projects witnessed phenomenal growth in the fiscal year 2022-23, adding approximately 14,500 km of transmission lines and 76,000 MVA capacity. A significant portion of this capacity addition came from the Green Energy Corridors. These projects will play a crucial role in reducing the total carbon footprint in India and contribute to the development of a sustainable and eco-friendly energy landscape.

The transition from traditional fossil fuels to green renewable sources and their integration into the grids has created a demand for green grids and Green Energy Corridor (GEC) projects in the transmission sector. The fiscal year 2022-23 was pivotal for decision-making in Tariff-based Competitive Bidding (TBCB) projects, with various 765kV and 400kV projects being planned in high renewable generating regions. Notably, an 8.9GW dedicated Green Energy Corridor was completed in Rajasthan.

SECI/MNRE (Solar Energy Corporation of India/Ministry of New and Renewable Energy) are planning for larger-scale projects with ambitious targets of approximately 500GW of renewable energy in the country. The special focus and contoured growth of the Green Energy Corridor (GEC) in the coming years make it a key segment for your Company to achieve its targets. The integration and connectivity of projects at higher kV levels, such as 765kV and 400kV, along with a mix of Extra High Voltage (EHV) substation projects, make your Companys offerings more attractive and competitive.

Effective use of Green Power

India has made remarkable strides in deploying renewable energy, witnessing a substantial increase in installed capacity in recent years. Solar and wind power have emerged as the primary sources, constituting a significant portion of the countrys green energy capacity.

However, the intermittent nature of solar and wind power poses challenges in ensuring uninterrupted electricity supply. To address this, India is actively exploring solutions for 24x7 dispatchable green power. One such approach is the development of hybrid renewable power plants that combine solar and wind technologies. Additionally, energy storage systems like battery storage and pump hydro are being deployed to store excess energy during high generation periods and supply it during low generation periods.

To accommodate higher shares of renewable energy, India is also investing in grid modernization and flexibility enhancement measures. This includes the establishment of green energy corridors (GEC), implementation of smart grids, utilization of advanced forecasting techniques, adoption of demand response mechanisms, and deployment of grid-scale energy management systems. These initiatives aim to effectively balance the supply and demand fluctuations associated with renewable energy generation.

In line with environmental objectives, the government of India has set ambitious targets to reduce the countrys total projected carbon emissions by 1 billion tons by 2030. Furthermore, the goal is to decrease the carbon intensity of the nations economy by less than 45% by the end of the decade and achieve net-zero carbon emissions by 2070.

Climate Change and Clean Transformation

As a signatory to the Paris Climate Agreement, India has committed to increasing its renewable energy capacity to 500 GW by 2030, aiming for 50% of its energy to come from renewable sources. This transition is crucial to fulfill Indias international commitments. At COP 26, India further pledged to achieve Net Zero CO2 emissions by 2070, reduce the carbon intensity of its economy by 45%, and decrease carbon emissions by 1 billion tons.

In the power generation sector, fossil fuels, particularly coal and gas, have historically dominated Indias energy mix. As of March 31, 2023, the installed base was approximately 399 GW, with around 235 GW being thermal generation from coal and gas. However, Indias share of renewable capacity in the overall generation mix is steadily increasing, with a target of reaching around 60% of the installed base by 2030.

Decarbonization of the power sector is a key focus area, as Indias CO2 emissions are projected to increase significantly by 2040, constituting 13% of global emissions. This highlights the urgent need for India to take measures against global warming and transition towards decarbonization. The power sector plays a critical role in achieving zero CO2 emissions for the country, alongside the increased electrification of energy demand.

Renewable energy currently accounts for 30% of Indias installed power capacity (excluding large hydro) and 41.6% when considering large hydro power plants. The share of renewable energy in the total electricity generation, including hydro, is around 30%. With renewable sources being key players, addressing climate issues, such as rising global temperatures and reducing CO2 emissions in grid and transmission systems, is of utmost importance.

SF6, a potent greenhouse gas, has been widely used for insulation purposes in high-voltage equipment in substations. However, finding safer alternatives to SF6 in transmission and distribution (T&D) equipment is crucial for the power sectors sustainability. GE has developed an alternative called g3 (Green Gas for Grid), which is an air-insulated switchgear (AIS) and gas-insulated switchgear (GIS) solution with significantly lower global warming potential compared to SF6.

GE is actively supplying g3-insulated AIS and GIS products to utilities in Europe and the US, and discussions are underway with certain utilities in India for pilot projects. Your company promotes and advocates for the use of climate-friendly products, collaborating with progressive utilities in India.

Additionally, the excessive use of metals in substations presents another challenge. Your company assists customers in accelerating the energy transition by providing hardware, digital solutions, and services necessary for delivering affordable, sustainable, and reliable electricity. Digital substation technology, for instance, helps reduce the carbon footprint by minimizing the use of copper, decreasing civil construction requirements, and increasing substation reliability. These products are designed to be operationally and maintenance-friendly.

Manufacturing sector Growth and Demand

Industrial power demand has been steadily increasing year over year, with a rise of approximately 9.6% in FY2022-23. This growth can be attributed, in part, to the Production Linked Incentive (PLI) scheme and policy, which has encouraged industrial output and investment. The power sector plays a dual role in the PLI scheme, producing equipment for both the domestic and export markets, leading to increased demand for new transmission and distribution lines, substations, and infrastructure.

The industrial sector serves as a clear benchmark for sectoral and country growth. To meet the growing demands and upgrade power infrastructure, India has actively sought private participation and investments in the country.

The increased industrial loads present opportunities for the power sector in load management and grid stability. Rapid industrial growth can lead to concentrated power consumption in specific areas, posing challenges related to load management and grid stability. It is essential for the power sector to ensure the proper distribution of power, balance loads across the grid, and address voltage fluctuations and grid imbalances caused by industrial clusters.

One example of industrial growth is observed in the data center sector, which has seen significant expansion in specific regions of the country. Data centers have become the backbone of multiple digital markets, attracting investments. The power requirements of data centers create a demand for extra-high voltage (EHV) substations, offering your organization more opportunities to participate in this sector.

Asset Health and Asset Performance Management (APM) Service

Transmission and distribution substation assets are valuable assets for utilities. Ensuring timely maintenance and keeping the equipment in good condition is a top priority for the Operations & Maintenance (O&M) department of any utility. Traditionally, utilities have followed the philosophy of time-based maintenance to efficiently run the utility and substations. However, with the emergence of evolving technologies such as Asset Performance Management (APM), the concept of need-based maintenance has gained prominence.

APM technology utilizes sensors like Dissolved Gas Analyzers (DGA) for transformers, CB watch sensors for circuit breakers, and other universal IoT devices installed around substation assets to collect data. The APM system analyzes this data and predicts the health of assets. The resulting Health Index helps determine maintenance requirements based on condition monitoring rather than relying solely on scheduled maintenance, leading to cost savings and minimizing downtime.

By utilizing dashboards that display the Air Quality Index (AQI) and Equipment Health Index, utilities can proactively identify potential issues and reduce the occurrence of unplanned breakdowns. This not only saves significant costs for utilities but also enhances the reliability and satisfaction of customers.

Digital and Software Solutions

On the technological front, artificial intelligence has opened up a new arena for exploration. The integration of artificial intelligence and machine learning capabilities into various digital products is on the rise. Numerous startups and investments in this space are taking advantage of these technologies to make products more versatile, sustainable, and user-friendly. As a result, new regulations surrounding artificial intelligence will be developed to ensure safe and permissible use.

In the power sector, one of the major challenges in India is the absorption and integration of renewable power at the transmission and distribution level. To measure the positive impact of renewable power down to the last mile, connecting distributed power plants to the grid with a focus on social impact can be achieved through appropriate policy-making. The privatization of distribution companies is increasing, leading to more investments in the sector. Grid solutions such as Distribution Energy Management Solution, Market Management Solutions, Micro/Mini Grid Integrations, and visibility in distribution systems, and ancillary markets are expected to become major market trends.

The Indian power sector has been actively modernizing the electricity grid and adopting smart grid technologies. This includes the implementation of advanced metering infrastructure, demand response mechanisms, and grid automation to enhance efficiency, reliability, and consumer engagement.

The Government of India is placing significant emphasis on reducing Aggregate Technical and Commercial (AT&C) losses, and investments in prepaid and smart meters present major opportunities in the market. Smart grid technologies in India are being implemented through advanced metering infrastructure (AMI) solutions, which provide communication and visibility to the last mile connections. This is crucial for the profitable and sustainable growth of distribution companies.

Market growth in operational technologies of DISCOMs is also observed in the Advanced Distribution Management System (ADMS) market, driven by the Revamped Distribution Sector Scheme (RDSS).

The Government of India has approved the RDSS to support DISCOMs in improving their operational efficiencies and financial sustainability. The scheme provides result-linked financial assistance to DISCOMs based on meeting pre-qualifying criteria and achieving minimum benchmarks. The scheme has an outlay of Rs 3,03,758 Crore over a period of 5 years (FY 2021-22 to FY 2025-26), with an estimated governments gross budgetary support (GBS) of Rs 97,631 Crore. The Rural Electrification Corporation (REC) and Power Finance Corporation (PFC) will facilitate the implementation of the scheme for DISCOMs.

The scheme aims to meet the following objectives:

• Reducing AT&C losses to pan-India levels of 12-15% by 2024-25.

• Eliminating the ACS-ARR gap by achieving a zero gap by 2024-25.

• Enhancing the quality, reliability, and affordability of power supply to consumers by establishing a financially sustainable and operationally efficient distribution sector.

Cross-Country Power exchange

India is connected to three neighboring countries, namely Nepal, Bhutan, and Bangladesh, through high voltage transmission grids. These interconnections play a vital role in maintaining a balance and ensuring a reliable power supply in times of power shortages or emergencies. Nepal and Bhutan primarily export hydroelectric power to India, which helps in incorporating non-fossil fuel sources into the Indian grid.

The cross-border power trade between these countries is expected to increase in the coming years, especially with the Government of Indias plans to implement the ONE SUN ONE WORLD ONE GRID (OSOWOG) scheme. Your organization is closely monitoring the benefits arising from the growing opportunities in the existing connections with Nepal, Bhutan, and Bangladesh, as well as exploring new opportunities in countries like Sri Lanka.

High Voltage Direct Current- HVDC

In India, remote areas such as deserts, mountainous regions, and offshore locations have an abundant supply of renewable energy sources like solar and wind. To harness these renewable resources, large-scale installations are required, which often necessitate the use of land parcels in remote areas that offer good potential for renewable energy generation. However, transmitting this energy over long distances to the load centers presents challenges, including transmission and distribution (T&D) losses and obtaining right-of-way for transmission lines. Additionally, ensuring stability in the transmission networks is crucial for the effective evacuation of renewable energy.

Globally, High Voltage Direct Current (HVDC) technology is widely recognized as an optimized transmission solution for transferring large amounts of power over long distances. With the increasing deployment of renewable energy capacities worldwide, the demand for HVDC projects has surged. In India, several large-scale geographies, such as Rajasthan, Khavda in Gujarat, and Leh-Ladakh, are being developed as hubs for renewable energy generation. HVDC projects are planned for these regions, including the Leh-Ladakh, Bhadla-Fatehpur, Khavda-Nagpur, and Khavda-South Olepad links.

Your company has previously executed a ?800 kV, 6000 MW HVDC project from Champa to Kurukshetra, showcasing its expertise in HVDC technologies. It is actively engaged with stakeholders to address the emerging opportunities in HVDC projects, including those in Leh-Ladakh, Khavda, and other regions.

Cyber Threats in Power Grids

Cybersecurity threats in power grids pose significant risks to the reliable operation of electrical systems. As power grids become increasingly interconnected and digitized, relying on complex networks and systems for monitoring, control, and communication, they become more vulnerable to potential attacks. Malicious actors target power grids with the intent of disrupting power supply and causing disturbances in the grids, leading to substantial commercial and industrial losses for countries and states. Ransomware attacks, in particular, are commonly observed in public services and facilities, including power grids. Given the numerous intrusion points in both the network and physical infrastructure, malware attacks are also a significant concern.

To address these challenges, new digital solutions are emerging that provide enhanced security measures for control centers and substations. Your organization is at the forefront of delivering innovative IT and OT security solutions to customers, continuously adapting to evolving cybersecurity threats. With a focus on multiple levels of security, your organization is well-prepared to meet the upcoming challenges and ensure the robust protection of power grids and associated infrastructure.

Policy, Regulation and Consolidations that favor the energy sector

Green Bonds:

Under the Union Budget 2022-23, the government made significant announcements related to sustainable finance and energy infrastructure. One such announcement was the issuance of sovereign green bonds. These bonds are specifically designed to finance environmentally friendly projects and initiatives, further promoting sustainable development in the country.

Additionally, the government conferred infrastructure status to energy storage systems, including grid-scale battery systems. This recognition highlights the importance of energy storage in the overall energy landscape and supports the development and deployment of advanced storage technologies. By granting infrastructure status, the government aims to attract investment, facilitate growth, and enhance the adoption of energy storage solutions, which play a crucial role in improving grid stability, managing renewable energy integration, and ensuring reliable power supply.

These measures align with the governments commitment to promoting clean energy, addressing climate change, and accelerating the transition towards a sustainable and resilient energy sector in India.

Green Hydrogen Mission:

In January 2023, India launched its comprehensive Hydron mission, setting targets for green hydrogen production in the country. The mission aims to establish India as a global hub for the production, utilization, and export of green hydrogen and its derivatives. By achieving these targets, the mission will contribute to Indias energy independence and the decarbonization of major sectors of the economy.

The targets set by the mission are not limited to meeting Indias domestic demand but also include the export of green hydrogen to other countries. The initial budget allocation for the mission is Rs. 19,744 crores, which includes Rs. 1,466 crores for pilot projects and Rs. 400 crores for research and development funds. The development of a green hydrogen production capacity of at least 5 million metric tonnes per annum, accompanied by the addition of approximately 125 GW of renewable energy capacity in the country, will result in the abatement of nearly 50 million metric tonnes of annual greenhouse gas emissions.

Significant progress has already been made in various projects under the mission. The Ministry of New and Renewable Energy has supported research and development projects, resulting in the establishment of a 5 Nm3/h green hydrogen production plant based on solar energy and electrolysis in Gurugram, Haryana, and a 6 kg per hour green hydrogen production plant based on biomass gasification in IISc Bangalore, Karnataka. Other projects include a green hydrogen manufacturing pilot plant with a capacity of 10 kg per day in Jorhat, Assam by Oil India Limited, a production plant with a capacity of 2 kg per day in Kawas, Gujarat by NTPC Limited, and a green ammonia plant in Bikaner, Rajasthan that produces green hydrogen at a rate of 500 Nm3/hr (approximately 175 tonnes per annum) by M/s ACME.

The widespread adoption of large-scale green hydrogen will also contribute to Indias goal of achieving 500 GW of renewable energy capacity. By utilizing green hydrogen, India is projected to abate 3.6 gigatonnes of CO2 emissions cumulatively between now and 2050.

Revamped Distribution Sector Scheme: Reforms-Based and Result-Linked

The Revamped Distribution Sector Scheme (RDSS) was launched by the government of India to assist DISCOMs in improving their operational efficiencies and financial sustainability. The scheme provides result-linked financial assistance to strengthen supply infrastructure, based on meeting pre-qualifying criteria and achieving basic minimum benchmarks. It has an outlay of Rs 3,03,758 Crore over a span of 5 years, from FY 2021-22 to FY 2025-26. The objectives of the scheme include reducing AT&C losses to pan-India levels of 12-15% and eliminating the ACS-ARR gap by 2024-25.

The RDSS is divided into two major components: Part A focuses on financial support for prepaid smart metering, system metering, and the upgradation of distribution infrastructure, while Part B focuses on training and capacity building, as well as other enabling and supporting activities.

Taking lessons from previous schemes, the Revamped Distribution Sector Scheme has been tailored to address the specific needs of each state. Out of the 31 states that participated, 14 have had their Integrated Power Development Scheme (IPDS) Detailed Project Reports (DPR) and budgets approved. Additionally, three state DISCOMs have submitted their proposals for infrastructure upgrades under the scheme. In the first year, leading organizations such as BEST Mumbai, Gujarat state DISCOMs, and UP state DISCOMs have taken the initiative by bringing out bids. Your organizations digital wings are well-positioned to participate and excel in this market segment with their software and grid automation equipment.

Other schemes, such as the Deen Dayal Upadhyay Gram Jyoti Yojana (DDUGJY) and IPDS, are also expected to contribute to the electrification efforts across the country. Furthermore, the policy supports commissioned power plants to sell electricity even in the absence of a valid Power Purchase Agreement (PPA).

National Bioenergy Programme

The Government launched the National Bioenergy Programme on November 2, 2022, with a plan for implementation in two phases. The Phase-I of the programme has been approved, and it includes several sub-schemes. These sub-schemes are the Waste to Energy Programme, Biomass Programme, and Biogas Programme.

Saubhagya Scheme

The Pradhan Mantri Sahaj Bijli Har Ghar Yojana, "Saubhagya," was launched by the Government of India with the aim of achieving universal household electrification. As of March 2021, 2.82 crore households have been electrified under this scheme. The total financial outlay of the project was Rs. 16,320 crore (US$ 2.19 billion), with a Gross Budgetary Support (GBS) of Rs. 12,320 crores (US$ 1.65 billion).

Boost to manufacturing

To create potential for domestic manufacturers and developers, the government will auction 40 GW of renewable energy projects, including 30 GW solar and 10 GW wind, every year until 2028. More than 70% of the equipment used for the generation of wind power is manufactured in India.

No environment clearance required for solar projects

The Ministry of Environment, Forest and Climate Change, Government of India, has clarified that solar PV (photovoltaic) power, solar thermal power projects, and solar parks will no longer require environmental clearance as per the provisions of the Environment Impact Assessment (EIA) notification, 2006.

Make in India Policy (MII)

The Make in India initiative is a government program that aims to transform India into a global design and manufacturing hub by creating a conducive environment for investments, developing modern and efficient infrastructure, and opening up new sectors for foreign capital. It has three stated objectives: to increase the manufacturing sectors growth rate to 12-14% per annum, to create 100 million additional manufacturing jobs in the economy, and to ensure that the manufacturing sectors contribution to GDP is increased to 25% by 2025. In the power sector, the Make in India initiative benefits organizations and suppliers that have 50-90% of Make in India content in their projects and products. Your organization has been truly making in India since 1958 and is reaping the benefits of the scheme with local manufacturing plants for multiple product lines in the country.

Investments in the Power Sector

As per the National Infrastructure Pipeline 2019-25, energy sector projects accounted for the highest share of 24% out of the total expected capital expenditure of Rs. 111 lakh crore (US$ 1.4 trillion). Indias Power sector is predicted to attract investment worth Rs. 9-9.5 trillion (US$ 128.24-135.37 billion) between FY19-FY23. In the Union Budget 2022-23, the Government allocated Rs. 19,500 crore (US$ 2.57 billion) for a Production Linked Incentive (PLI) Scheme.

In the Union Budget 2022-23, the government allocated US$ 885 million (Rs. 7,327 crore) for the solar power sector, including grid, off-grid, and Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) projects.

The Phase-I of the National Bioenergy Programme has been approved with a budget outlay of US$ 103 million (Rs. 858 crore).

In the Union Budget 2022-23, the allocation for the Solar Energy Corporation of India (SECI), which is currently responsible for the development of the entire renewable energy sector, stood at US$ 132 million (Rs. 1,000 crores).

The Production Linked Incentive Scheme (Tranche II) on the National Programme on High Efficiency Solar PV Modules, with an outlay of US$ 2.35 billion (Rs. 19,500 crore), was approved and launched.

The flow of money from international financing companies continues unhindered, with Germanys Kreditanstalt f?r Wiederaufbau (KFW) group, Japan International Cooperation Agency (JICA), and the World Bank as major investors in the Indian power sector. The Government of India has successfully roped in KFW for further investments in Renewable Power Evacuation Projects. KFW intends to invest USD 500 billion in the sector for the projects planned until 2028. Bangladesh continues to be a lucrative market for investments by KFW and JICA.

The allowance of 100% Foreign Direct Investment (FDI) in the power sector has boosted FDI inflow in this sector.

According to the Economic Survey, an investment of US$ 330 billion is predicted in the renewable sector by 2030.

Opportunities

India has emerged as one of the best-growing economies, showing a +7.2% Gross Domestic Product (GDP) growth, expected to be $3.3 trillion and eventually targeting $3.7 trillion in 2023, and eventually targeting $5 trillion in 2025. India also ranks on top as the favorite economy for global investments. The manufacturing segment is contributing substantially to the growth journey. FY 2023-24 brings out major digital growth in the transmission sector with revamping and upgrade schemes of Ultra High Voltage (UHV) Long-Distance Transmission (ULDC), National Load Dispatch Center (NLDC), and National Transmission Asset Management Center (NTAMC) projects. The ever-increasing demand for power and consumption is leading to a rising growth graph for the Indian power sector. The rising peak demand to the tune of approximately 209 GW in December 22 was observed. Further growth targets are expected at a steady rate of 6% Compound Annual Growth Rate (CAGR) and estimated to hit approximately 2000 billion units by 2027. In FY 2022-23, India generated 1640 billion units (BU) of electricity, 8.9% more than FY 2021-22.

Green Energy Corridors and Tariff Based Competitive projects continue to grow in the 765/400 kV network for bringing renewable power to load centers. 765/400 kV projects bring your organization to play in the competitive market with Gas Insulated Switchgear (GIS), Air Insulated Switchgear (AIS), Transformers, Grid Automation, Communication, and digital product and service offerings.

The growth in the digital drive in the utilities and customers continues to benefit the organization with increased access to the market. Since digital IT systems have a lifetime of 5-7 years and due to the ever-evolving cyber threat landscapes, digital projects are continuously being conceived, and this helps your organization to grow in this domain.

Many states are now increasing their spending on the unmanned substations, and State Transmission Asset Management Control Center (STAMCC) projects are being conceived. These are similar to the National Transmission Asset Management Control Center projects for state assets. Upcoming states like Orissa, Uttar Pradesh, Madhya Pradesh, Delhi, and Kerala are preparing for these initiatives in FY 2023-24. Asset Performance Management (APM) solutions are becoming a primary part of these upcoming projects. Your organization is best suited to cater to customers and market needs, as most of the solutions come from GEs product portfolio.

The central transmission grid operator, Power Grid Corporation of India (PGCIL), has already commissioned the worlds biggest Wide Area Monitoring System (WAMS), awarded to your organization in 2013-14. WAMS phase 2 of approximately the same size will be launched soon, and this will help your organizations Digital Grid software and Grid Automation division to access increased markets.

With increased absorption of renewable power, multiple Flexible Alternating Current Transmission Systems (FACTS) and Static Synchronous Compensators (STATCOM) projects are in line with the countrys requirement for reliable, stable, and dispatchable power in FY 2023-24. These are niche markets with limited players accessing the market. GETDIL is poised to play in the market and increase its market share by offering its products and projects.

The growth of demand due to industrial needs, increasing electric vehicle loads, and increasing load in domestic sectors with increased penetration in villages. The load pattern and demand are expected to increase by approximately 5.5% in the coming years, creating the need for more distribution networks, transmission networks, and Extra High Voltage (EHV) substations.

The opportunities in the coming years focus on providing clean, round-the-clock, safe and reliable energy to the end users, and promise a stable growth of the Transmission and Distribution sector.

Threats

The Russia-Ukraine war had an impact on the supply chains and energy crisis in FY 2021-22. However, the situations improved in FY 2022-23 with the establishment of alternate supply chains and source countries. The global energy market price rise trend stabilized, although some commodities prices still observed an upward movement. Governments also took steps to curb inflation and mitigate the pressure caused by the situations. The realignment of the oil and gas sector with alternate routes helped mitigate the impact to some extent.

All industries have safety nets in place to manage costs, but the threat of recession has not been ruled out yet. Your company is prepared to face any eventualities and ensure it is not crippled by them. Risks in the power sector can be mitigated through technological solutions.

Artificial Intelligence (AI) is a technological advancement, but it can also pose a threat of job cuts and reduce the use of manpower. To mitigate these concerns, the use of AI must be regulated and monitored. Framing regulations around AI will be beneficial for both sides.

Delays in project launching due to right-of-way issues and the availability of lands for substations are among the biggest challenges in the power transmission and distribution sector.

Your company is aware of these threats and well-prepared to manage them by taking necessary steps for sustainable business growth.

Business Projections

The market sentiments for the overall business environment are expected to improve in the Financial Year 2023-2024, as the market has recovered and Tariff-Based Competitive Bidding (TBCB) projects are maturing. Alongside the transmission projects, there is a significant opportunity for the growth of the digital business. The company is cautious and selective in choosing the opportunities and focuses on playing to its strengths. Despite challenges and political and economic volatility, the company continues to have an order booking of more than Rs. 36.9 billion as of March 31, 2023, which positions it well to sustain market pressures and be equipped for future growth.

Support Functions

Human Resources

The permanent employee strength of the Company as on March 31, 2023 was 1873.

Industrial Relations

During the year under review, labour relations at Hosur, Padappai, Pallavaram, and Vadodara units remained cordial. This has helped your Company to increase the labour productivity and efficiency.

Diversity

Your Company understands the gender sensitivities. Providing a safe and secure work environment for women is always a top priority. Gender diversity has always been important to your Company. Your Company always aims to enrich its gender diversity while hiring for open positions. The management promotes a diverse work culture and adopts fair and transparent employment practices for gender- diverse candidates.

The Company and Factories initiated diversity and inclusion programs, which helped in building a holistic ecosystem for diverse candidates, with focus on on-boarding, learning, networking, awareness, and growth. These diversity inclusion programs are listed below:

SHINE Program – Shine is a 6-month, non-rotational program for diverse groups of early career talent . This program combines individual development, training, action learning and networking to enable you to drive better outcomes in a faster, simpler, adaptive and more customer-driven organization while preparing you for future roles, with expanded responsibility. This program gives assignments to work on a project, alongside other colleagues, that will have a direct impact to our business. This includes having monthly learning roundtables with a number of subject matter experts on topics ranging from Lean, Finance, Project management, among others.

Fulcrum (Pallavaram) – The Fulcrum program provides supported networking and learning opportunities for women employees and enables dialogue with business leaders. It supports the efforts and contributions of women in operations and involves them in initiatives focused on health, wellness, corporate social responsibility, and sports. This program helps women in operations develop competencies for fast career progression by offering customized leadership development programs. Furthermore, this program helps in breaking gender biases and stereotypes.

The Fulcrum program aims to support and elevate women in operations by developing their competencies and providing opportunities for them to make a greater impact in the business. The program celebrates women in operations through various initiatives such as health talks, legal sessions, and celebrations on International Womens Day. Networking and inclusion activities like cross-functional knowledge sharing sessions and roundtable discussions with leaders promote collaboration and diversity. The program also focuses on career and leadership development by organizing sessions on personality improvement, leadership talks, and assigning mentors and stretch assignments. The program emphasizes building a diverse culture by elevating women to higher positions, increasing diversity in hiring, and ensuring female candidates are considered for open positions.

Snegithi Womens Network (Padappai) – Your company is committed to fostering a culture of diversity and inclusion in the workplace. The Snegithi - Padappais Womens Network Group was established in 2019 as a women-led network aimed at connecting women and celebrating their ambition. The group regularly engages to share experiences, generate ideas for engagement initiatives, and obtain organizational support to fulfill their career aspirations. It operates under five distinct pillars: Capability Building, Work-Life Balance, Health & Wellness, Employee Engagement & CSR. In 2022, the group organized various initiatives aligned with these pillars, including Womens Day Celebrations, Leadership Connect, Virtual and Classroom Learning Sessions, Go Green - Tree Sapling initiative, POSH Awareness Roadshows, Mental Health & Wellness Sessions, and CSR activities in an orphanage home. Your companys strong network of women employees provides a platform for exchanging views and supporting women in their career growth.

Succession Planning

Your company is dedicated to identifying and nurturing internal talents for leadership and critical roles, while also mapping potential external talent pipelines. The company prioritizes enhancing organizational efficiency and fostering accountability, with the aim of improving communication speed and delivering prompt services to customers.

The management, with the assistance of the Human Resource team, maintains a strong emphasis on identifying successors for leadership positions and positions that require essential skill sets.

Finance

The finance function of your Company remains committed to driving initiatives that enhance performance. There is a strong emphasis on risk management, internal controls, and cost optimization through rigorous operational practices and financial discipline. In the financial year 2022-23, the Company achieved a profit before tax and exceptional items of Rs. 381.3 million, attributed to improved project execution, cost control measures, the sale of Niani Unit, and stabilization of commodity prices. However, the Company experienced a 10% decrease in revenue compared to the previous year, primarily due to lower backlog and book and bill orders. As of March 31, 2023, the Companys net borrowings stand at Rs. 1,729.9 million, reflecting an increase of Rs. 919.5 million from the previous year, primarily driven by higher working capital requirements. The Company is actively focused on reducing inventory, improving receivables and retention collection to generate cash flow. The management team is dedicated to pursuing strategic initiatives that aim to improve financial performance, profitability, and liquidity. It is confident that these initiatives will lead to enhanced profits for the Company.

Details of significant changes (i.e., change of 25% or more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations thereof, including, are listed below:

Ratio		Calculation	March23	March22	% Change
(i)	Current ratio1	Current Assets/ Current Liabilities	1.1	1.1	0.7%
(ii)	Debt- Equity Ratio2	Borrowings/ Shareholders Equity	0.2	0.2	35.4%
(iii)	Inventory Turnover ratio1	Cost of goods sold/ Inventory	3.1	3.8	(19.8%)
(iv)	Trade Receivable Turnover Ratio / Debtors Turnover Ratios1	Revenue from operations/ Trade Receivable	1.8	2.0	(8.9%)
(v)	Debt Service Coverage ratio / Interest Coverage Ratio3	Earnings for debt service = Net profit before tax & Exceptional Items + Interest on borrowings/ Borrowings	0.3	(1.0)	(127.1%)
(vi)	Net Profit ratio / Net Profit Margin (%)3	Net Profits before taxes/ Revenue from operations	1.0%	(2.3%)	(142.6%)

1 No significant variance

2 Companys Debt has increased owing to higher working capital requirement of inventory plus execution of loss contracts

3 Debt Service Ratio and Profitability Ratios has improved because of positive operational profits during the year

Details of any change in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof:

Net worth of the Company has reduced to Rs. 10,727.1 million as on March 31, 2023 compared to Rs. 10,802.9 million as on March 31, 2022 primarily driven by total comprehensive loss during the year of Rs. 75.8 million.

Investor Relations

Your Company maintains a strong commitment to prioritizing the interests of stakeholders and ensuring transparency by sharing relevant information with them in a timely manner. It takes stakeholders inputs and suggestions seriously and acts upon them accordingly. Regular engagement with stakeholders is a crucial aspect of the Companys ethos to ensure sustainable performance. Building and maintaining a strong working relationship with stakeholders is important, which is why the Company consistently holds quarterly earnings conference calls with investors and analysts. During these calls, the Company provides updates on the Transmission and Distribution (T&D) market, potential opportunities, as well as presents its operational and financial performance. Attendees are encouraged to raise questions and seek clarification directly from top management. Audio recordings and transcripts of the conference calls are uploaded on the Companys website and stock exchange platforms.

In addition to conference calls, the Company disseminates information through press releases and stock exchange communications to keep stakeholders well-informed of the latest developments. Presentations, analyses, and financial results are shared with investors and are also made available on the Companys website at www.ge.com/in/ge-td-india-limited.

Risk and Internal Controls

A robust internal control framework has been an essential part of the Companys operations and corporate governance. The framework provides reasonable assurance on reliability of financial information, compliances with laws and regulations, and realization and optimization of operations. It ensures documentation and evaluation of unit and entity level controls through existing policies and procedures, primarily to identify any significant gaps, and define critical actions for improvement. Also, a formal system exists for periodic monitoring and reporting of the results of the internal control self-assessments.

During the year, as per the provisions of Companies Act, 2013, an in-depth exercise for evaluating the adequacy of internal controls over financial reporting, was undertaken, and the management assessed their design and operating effectiveness. It was concluded that, as on March 31, 2023, controls were operating effectively.

Further, as part of the statutory audit, the statutory auditors opined that the Company has, in all material respects, an adequate internal financial control system over financial reporting. All such controls were operating effectively as on March 31, 2023.

Outlook

The Indian Power sector is undergoing constant and consistent growth, driven by a focused approach to incorporate more Renewable power into the grid. With a higher share of Renewable energy in the grid, there is a need for an optimal mix of conventional power to meet the growing demand from industrial and domestic consumers, which is driving the countrys economic growth. The aim is to achieve the target of Green Power for All and attain net zero CO2 emissions as committed in COP26 by the Government of India. Over the next five to ten years, the Transmission and Distribution (T&D) market is expected to grow steadily due to several factors:

i. The target of installing around 500 GW of renewable energy capacity by 2030.

ii. Continued focus on system strengthening and upgrading aging infrastructure by both state and central governments.

iii. Indias commitment to reducing carbon footprint by 50% by 2030 as part of COP26.

iv. Increasing adoption of electric vehicles (EVs) leading to a surge in electricity demand and the need to upgrade the grid infrastructure with advanced technologies. The National Electric Mobility Mission Plan aims for maximum EV adoption by 2030.

v. Implementation of the Green Hydrogen policy attracting more investments in the market.

vi. Industrial sector aiming for net zero emissions and investing in a mix of Renewable resources, including storage and hydrogen.

vii. Governments infrastructure push in the country, such as railway and metro rail projects, high-speed train connectivity, and the growing demand for power from digital-driven data centers.

viii. Cross-border power trade and strengthening of inter-regional grids.

ix. Evolution of hybrid market opportunities and projects combining wind, solar, and battery storage, for which the Company has developed capabilities and solutions.

x. Anticipated 6.0% demand-side growth, generating the need for additional power and a robust transmission network.

The Companys management is focused on leveraging these evolving trends and opportunities in the Power sector.

Cautionary Statement

This management discussion and analysis statement contains what could be regarded as forward-looking statements and information. These statements include forecasts and estimates as well as the assumptions on which they are based, statements related to projects, objectives, and expectations concerning future operations, products, and services or future performance. The readers are hereby cautioned and advised that these forward-looking statements are subject to numerous risks and uncertainties that are difficult to foresee, and actual outcomes might differ significantly.

For and on behalf of the Board

Place : Noida	Mahesh Shrikrishna Palashikar
Date : June 26, 2023	Chairman
	DIN: 02275903