Ravindra Energy Ltd Management Discussions

In FY 2025, India added 23.8 GW of solar capacity. Solar capacity additions increased YoY by 59% compared to 15 GW installed in FY 2024. The total installed solar capacity in India as of FY 2025 is at 106 GW. Of this Ground mounted solar capacity accounts for 86% installed base. Grid connected rooftop capacity now stands at 14% of the installed capacity.

As of March 2025, renewable energy (including large hydro) forms a significant and increasing share of Indias energy mix, accounting for 46.3% of the total installed capacity at 220 GW out of 475 GW. Within renewable energy, solar power leads with 106 GW, comprising 48% of the RE portfolio, followed by wind at 50 GW (23%). This strong push toward renewables reflects Indias strategic shift toward cleaner sources of energy to enhance energy security, meet its climate goals, and decarbonise its growing economy. Solar and wind are expected to drive the next wave of capacity additions, supported by falling costs, favourable policies and strong investor interest.

Indias installed electricity generation capacity has grown steadily from 305 GW in FY 2016 to 475 GW in FY 2025, driven by continued expansion across conventional and renewable energy sources. While coal still form the largest share at 222 GW (46.7%), the most significant trend has been the acceleration of solar capacity. It has grown at an increasing rate from 7 GW in FY 2016 to 106 GW in FY 2025.

Due to regulatory changes in key states like Maharashtra, lack of transmission infrastructure, and delays in the connectivity approval process, the commissioning of solar open access projects has slowed down.

India added 1.1 GW of solar open access capacity in Q1 of CY 25, down from 47% YoY compared to nearly 2 GW installed in Q1 of CY 24. As of March 2025, the cumulative installed solar open access capacity in India was 21.5 GW. Maharashtra, Tamil Nadu and Karnataka account for majority of the new additional capacity.

Driven by PM Suryaghar: Muft Bijli Yojana, India added 1.2 GW of rooftop solar capacity in Q1 of 2025, a massive jump of 232% YoY compared to 366.5 MW installed in Q1 of 2024. The capacity added during this quarter was the second highest quarterly installation to date. The residential segment accounted for nearly 78% of installation in this quarter. Indias cumulative rooftop solar capacity has now reached 14.9 GW.

Maharashtra has taken a leading role in implementation of PM-KUSUM, particularly under Component C which focuses on the solarisation of existing grid-connected pumps. The states efforts are further amplified through initiatives like the Mukhyamantri Saur Krishi Vahini Yojana (MSKVY) 2.0, which aims to address the growing energy demand in the agricultural sector, currently estimated at 14,000 MW.

Over the next 3-4 years, we believe that the solar power capacity addition, especially under KUSUM scheme and open access, will accelerate. This is because of two reasons- 1) electricity demand is expected to grow at significant pace and

2) governments push for rural improving electricity supply to farmers. We estimate that India will need to add another 100 GW of renewable energy capacity in next five years with solar capacity addition being the main contributor.

While the opportunity is large, there are various challenges that can derail the potential growth story:

One of the biggest challenges in the solar sector is the availability of land. Solar PV plants require a large amount of contiguous land to set up. However, rapid urbanization, fragmented ownership, challenges in establishing titles and social issues make land aggregation one of the biggest impediment and risk to the growth of the sector.

• Maharashtras Energy Banking rules could limit the solar capacity additions. The recent MERC tariff order requires that consumption and generation occur within the same time slot. This will limit operational flexibility for C&I customers with diverse load patterns and could potentially affect the economic returns of standalone solar projects, particularly when surplus generation during the day does not align with consumption needs.

• Availability of timely transmission connectivity is another challenge. To optimise costs, utilisation levels and losses associated with the transmission system, robust transmission planning is crucial. Various stakeholders at appropriate levels have raised concerns about the connectivity for renewable projects. In response, nodal agencies (PGCIL and SECI) have planned various schemes to reduce grid congestion and enhance connectivity.

• The Indian government has mandated the use of domestically manufactured solar PV cells and modules in various schemes, including PM-KUSUM and rooftop solar programs.

• While theres a push for local manufacturing, Indias solar cell production capacity lags behind the demand, especially for projects requiring domestic content requirements (DCR)

• This disparity leads to higher costs for DCR modules and potential shortages, hindering the expansion of these crucial renewable energy initiatives

The details of project implementation and business development is given in the Directors Report under the head Projects. The segment-wise performance is as under -

We have recently entered into another power purchase agreement with MSEDCL (govt. of Maharashtra distribution utility) to build, own and operate 44 MW AC solar project. The projects are being installed under the KUSUM C scheme. The project needs to be commissioned by July 2026. In addition, we are currently developing renewable energy parks to cater to growing demand of open access customers. We believe that the long-term outlook for your Company is positive

We believe the following are the key risks to the Companys business:

Concentration of tenders in short period: If the procurement tenders are concentrated in a short period, we will not be able to participate in all tenders. Further, it will also increase the working capital requirement of the business.

Delay in payment by government agencies: If the payment from government agencies is delayed, it will reduce our ability to execute. Further, it will also impact the profitability of the business.

Increasing competition: We believe that increasing competition might result in unviable bids thereby reducing our ability to leverage on the potential opportunity size.

Default by off-takers: As we are also operating several assets under long term power purchase agreements, any default by offtakers will result in a significant loss.

Lack of water for cleaning: Some of the projects are located in drought areas. As a result, there is a risk that in some years we might not be able to regularly clean the modules thereby reducing the potential generation.

Dependence on weather for generation: The projects will always be exposed to this risk. Any significant changes in weather patterns can result in significant loss of generation.

Lack of financing: The Companys ability to grow business is also dependent to timely availability of inexpensive finance.

The Company has constituted Risks Management Committee, to monitor and review risk. Risk Management Policy has been framed and the Company is committed to managing the risk in accordance with the process set out in the policy to benefit the Company.

The compliance certification from Whole-Time Director and the Chief Financial Officer provided in Annual Report confirms the adequacy of our internal control system and procedure. The Audit Committee in every meeting evaluates internal financial controls and risk management systems.

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) and comply with the Accounting Standards specified under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014.

The standalone revenue from operations for the year ended March 31, 2025 was Rs. 1,881.25 million and other income was Rs. 101.59 million, aggregating to Rs. 1,982.85 million, as against revenue from operations of Rs. 606.42 million and other income was Rs. 43.59 million, aggregating to Rs. 650.01 million for the previous year ended March 31, 2024.

The Companys Profit After Tax was Rs. 246.15 million for the year ended March 31, 2025 as compared to Rs. 108.44 million for the previous year ended March 31, 2024. Revenue from operations includes, Contract Revenue from Solar Projects, installation and commissioning, other operational revenue Share of Profit From LLPs, Revenue from O & M Services, sale of electricity, etc.

The consolidated revenue from operations for the year ended March 31, 2025 was Rs. 2,504.22 million and other income was Rs. 117.87 million, aggregating to Rs. 2,622.09 million, as against revenue from operations of Rs. 1,309.67 million and other income was Rs. 154.73 million, aggregating to Rs. 1,464.40 million for the previous year ended March 31, 2024.

The Company incurred a consolidated profit of Rs. 218. 11 million for the year ended March 31, 2025 as against consolidated loss of Rs. 508.94 million for the previous year ended March 31, 2024.

The Companys objective is to build a sustainable organization, while creating growth opportunities for our employees and generating profitable returns to our stakeholders.

The total work force of the Company as on March 31, 2025 was 175. Number will increase in line with the growth of the business of the Company. The Company is aware that satisfied, highly motivated and loyal employees contribute to the growth of the Company. The employee relations remained cordial throughout the year.

In preparation of the financial statements for the year ended March 31, 2025, no treatment different from that prescribed in an Accounting Standard has been followed by the Company.