ind renewable energy ltd share price Management discussions


Just as the world was on the mend post multiple waves of COVID, the Russia-Ukraine conflict induced a trail of irreversible economic, social and political effects. Global inflation touched an all-time high of >8% with many developed economies witnessing double digit inflation figures for the first time in many decades. This led the central banks across the globe to simultaneously hike interest rates in a bid to tame inflation. Repercussions of the conflict were also visible in disrupted trade relations and spiralling energy prices resulting in severe global energy crunch leading to significant diversion from the otherwise chartered growth paths. While the ramifications were evident all over the world, Europe was hit the hardest. As Europe braved an unprecedented energy crisis, people worldwide realized the importance of self-reliance for energy and consequentially, countries advanced their climate goals. This turbocharged the growth momentum of renewables and green sources. As supply chain disruptions and rise in commodity prices posed a temporary retardant to this growth story, bulk of low-carbon investments were directed towards building resilient supply ecosystems along with renewable capacities. Having weathered the storm in 2022, this year the economies will be seen establishing their redefined pathways.

INDIAN ECONOMIC OVERVIEW

The Indian economy remained remarkably resilient to global challenges in F.Y. 2022-23. This is evident by robust domestic demand and upbeat investment activity. Sectoral analysis reveals that growth was driven by robust construction activity aided by increased infrastructure investment both by the Central Government and State Governments, which paved the way for large-scale employment opportunities. Building on the gains of first half of the fiscal year, the second half continued to see a gradual upswing in demand and economic activity.

The push for renewables continued in line with the governments target of achieving 500 GW of installed electricity capacity from non-fossil sources by 2030, aided through a slew of measures and schemes announced during the year. The government released new renewable purchase obligation (RPO) targets by creating an exclusive category of wind energy to boost the segment and also released guidelines for the second tranche of Productivity-Linked Incentive (PLI) scheme worth ^ 19,500 crore for solar manufacturing. However, growth trajectory was marred by increase in the cost of polysilicon and supply chain disruptions emanating from China resulting in almost a 40% increase in the price of solar PV modules. Since September, 2022, owing to drop in polysilicon prices, there has been a gradual reduction in the module prices which boded well for the solar developers.

BUSINESS & OPERATIONAL OVERVIEW

Your Company follows a customer -centric business philosophy, with its growth strategy centered on transparency in term of offerings, suitability of products and variety of choices to meet a range of needs of its customers.

A key strength of your company is the variety of its funding sources, which helps it optimize funding costs, protect interest margins, and retain its diversified funding portfolio. At the same time, this also enables the Company to achieve funding stability and liquidity, facilitating reduction in average borrowing costs.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

Due to the financial crises and other certain unavoidable circumstances, The Income during the financial year ended 31st March 2023 is NIL compared to Rs. 5.59 Lakhs in the previous year. The profit for the financial year ended 31st March 2023 is Rs 0.05 compared to loss of Rs. 8.66 in the previous year.

Ratios

Ratios

Current Reporting Period Previous Reporting Period % of Change

Current Ratio

17.61% 22.57 22%

Debt Equity Ratio

0.05% 0.04 36%

Return on Equity Ratio

0.01% -2.68% -101%

Trade payables turnover ratio

3.49% 21.80% -84%

Return on Capital employed

-1.77% -2.69% -34%

Return on investment

0.01% -2.71% -101%

OPPORTUNITIES AND THREATS

India has an unwavering commitment to the preservation of the Environment and reduction in GHG emissions to fight the menace of global warming. Honourable Prime Minister has reemphasized this through the 5 key commitments coined as Panchamrit, at COP-26, Glasgow.

Various policy initiatives to fulfil these commitments, coupled with the increase in power demand due to the recovery of the economy post-pandemic, have provided ample growth opportunities for the Company.

Due to increase competition the falling tariff is a matter of concern.

The situation has worsened due to Covid 19 pandemic with economic activities almost coming to a standstill. This has affected the Companys operations. The Company now concentrates on new growth plan.

SEGMENT - WISE PERFORMANCE

The Company is working in one segment during the year under review, hence the requirement of segment-wise reporting is considered irrelevant.

OUTLOOK

India has been continuously putting efforts in terms of exploiting its given renewable energy sources potential over more than a decade, but a serious turnaround in its development has been observed since 2014, courtesy the due attention given by the government and certain bold initiatives taken on the policies front, which gave more heed to the already existing pro-renewable sentiments in the country. With rapid urbanization and the anticipated northbound trends in the industrial sector growth, power demand in India is projected to climb a new high in coming years. To support this likely jump there arises an urgent need for a backup in order to avoid any fallout in the desired power requirement.

HUMAN RESOURCES

Employees relations continued to be harmonious throughout the year with the management. Your Company believes that, its employees are its greatest strength and the most valuable asset. The management and staff have a mutual faith and trust. The Company provides equal opportunity to all employees and strives to inculcate high performance culture in the organisation. Your company remains focused on attracting the best talent in the industry, nurturing them through robust learning and development mechanisms, and retaining them through progressive employee centric policies and practices.

INTERNAL CONTROL SYSTEMS

Your Company has an adequate system of internal controls for business processes, operations, financial reporting, fraud control, and compliance with applicable laws and regulations, among others. Your companys Management Assurance and Audit function is headed by a senior management personnel with reporting lines to the Audit Committee of the Board and a dotted line reporting to the Managing Director.

COMPLIANCE

The Compliance function of the Company is responsible for independently ensuring that operating and business units comply with regulatory and internal guidelines. The Compliance department of the Company is continued to play a pivotal role in ensuring implementation of Compliance functions in accordance with the directives issued by regulators, the Companys Board of Directors and the Companys Compliance Policy. The Audit Committee of the Board reviews the performance of the

Compliance Department and the status of compliance with regulatory/internal guidelines on a periodic basis.

New instructions / guidelines issued by the regulatory authorities were disseminated across the Company to ensure that the business and the functional units operate within the boundaries set by regulators and that compliance risks are suitably monitored and mitigated in their course of their activities and processes. New products and process launched during the year were subjected to scrutiny from compliance standpoint and proposals of financial services were screened from risk control prospective. The company has complied with all requirement of regulatory authorities.

RISKS

Company classifies the risks broadly into two categories, viz., External Risks and Internal Risks. The external risks mainly comprises of business risks on various fronts. The identified business risks and opportunities are deliberated in detail and thereafter considered in the business plan of the Company along with the mitigation plan. The internal risks identified by the Board are systematically addressed on a continuous basis across the locations.

CAUTIONARY STATEMENT

Certain statements under "Management Discussion & Analysis " describing the Companys objectives, projects, estimates, expectations and predictions may forward looking statement within the meaning of applicable securities laws and regulations. Although the expectations are based on reasonable assumptions, the actual results could materially differ from those expressed or implied, since the companys operations are influenced by many external and internal factors beyond the control of the Company. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent developments, information or events.

Mumbai

Date: 29.08.2023

For and on behalf of the Board of Directors
Sd\-
(Anupam N Gupta)
Managing Director