Virescent Renewable Energy Trust Management Discussions

Virescent Renewable Energy Trust ("VRET" or "Trust") is an irrevocable trust set up under the Indian Trusts Act, 1882 and registered with the Securities and Exchange Board of India as an infrastructure investment trust under the Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014.

In FY22, the Trusts portfolio comprised of 14 operational solar power projects, aggregating to 500 MWp, in the States of Maharashtra, Tamil Nadu, Rajasthan, Gujarat and Uttar Pradesh. Subsequently, in the current year ending 31 March 2023, the Trust acquired 2 operational solar power projects, aggregating to 38 MWp, in the States of Rajasthan & Uttar Pradesh, thereby taking the cumulative capacity to 538 MWp.

Further, Trust (through its subsidiary) has entered into binding agreements for the acquisition of 25 MWp operational solar power project in Gujarat, from Samta Energy Private Limited.

The Summary of financial statements on a Consolidated and Standalone basis of the Trust for the year ended March 31, 2023, are as follows:

(Amt in INR Mn)

Consolidated income statement comprises of Revenue, EBITDA and PAT generated from seed assets of (i.e., assets acquired from sponsor) as well as assets acquired by InvIT (from Focal Energy Group, GPIL and Jakson group). Revenue from seed assets is recorded from the beginning of financial year or from the date of acquisition by the sponsor, whichever is later. In case of assets acquired by InvIT, revenue is accounted from the date of acquisition.

Standalone income statement comprises of revenue generated from interest on debt provided by VRET to underlying SPVs.

VRET is primarily engaged in owning and operating renewable energy assets with long term PPAs tied up with respective central/state offtakers. Accordingly, VRET has a single segment as per the requirements of Ind AS 108 - Operating Segments. All assets are located in India and revenue of VRET is earned in India hence, there is single geographic segment.

During FY23, the following borrowings have been raised:

Consolidated borrowings as on March 31, 2023, stood at INR 17,401 Mn entirely in the form of Non-Convertible Debentures.

o Weighted Average Cost of Debt = 7.57% payable quarterly (7.79% annualized) o AAA Rating by CRISIL & India Ratings

The Investment Manager (on behalf of VRET) has made best efforts to utilise the Issue Proceeds (allocated towards payments of Issue expenses) as per the terms of the Placement Memorandum dated September 28, 2021. However, there has been a reduction in actual Issue Expenses incurred, as against the estimate made at the time of Issue, to the extent of INR 27.00 Mn.

Virescent Renewable Energy Trust with the approval of Unitholders on September 15, 2022, has included the below object with respect to unutilized Use of Proceeds for an aggregate amount of INR 27.00 Mn from the Issue Proceeds, which was not covered in the Placement Memorandum (PM) dated September 28, 2021:

Interest payment/principal repayment (including creation of Debt Service Reserve), for Non-Convertible Debentures issued/ to be issued by VRET.