IndiGrid’s Q2 FY 2024 Profits Plummet to $388.91 Million, Down 69.1% YoY
The company's revenue surges 20% YoY to ₹6.95 billion
India Grid Trust (IndiGrid), a power infrastructure investment trust, has recorded a profit of ₹32.3 billion (~$388.91 million) during the second quarter (Q2) of the financial year (FY) 2024, a year-over-year (YoY) decrease of 69.1% from ₹107.4 billion (~$1.29 billion).
The company has earned a revenue of ₹6.95 billion (~$83.4 million), which was up 20% YoY, and the consolidated earnings before interest, taxes, depreciation, and amortization (EBITDA) was up 4% YoY to ₹5.58 billion (~$67 million).
The lower profit in the most recent period for IndiGrid compared to prior periods can be attributed to the one-time integration expenses related to the acquisition of Virescent Renewable Energy Trust (VRET) for approximately ₹40 billion (~$487 million). Additionally, fluctuations in deferred tax, changes in current tax expenses, and variations in income tax for earlier years have contributed to the overall decrease in profit.
The company secured a winning bid for a 20 MW/40 MWh Battery Energy Storage System (BESS) project from BRPL with a 12-year contract. However, the EBITDA for the quarter included one-time integration expenses related to the VRET acquisition, which impacted profitability.
The EBITDA for the quarter includes one-time integration expenses related to the VRET acquisition.
Despite the profit decline, IndiGrid’s collections for transmission assets reached 114%, while solar assets performed even better at 127% in the same quarter. The Distribution Per Unit (DPU) increased by approximately 3%, rising from ₹3.45 ($0.04) in Q1 FY24 to ₹3.55 ($0.04), reflecting a YoY growth of about 7.5%.
One significant achievement for IndiGrid was the expansion of its renewable energy portfolio, which grew fivefold from 138 MW to 676 MW, largely due to the VRET acquisition. This expansion also led to an 18% growth in assets under management (AUM), reaching ₹269 billion (~$3.2 million).
The net distributable cash flow increased by 10% compared to the previous year, reaching ₹3.08 billion (~$36.9 million) in the quarter. This demonstrated the financial strength of the company.
In terms of market conditions, the average quarterly peak power demand in Q2 2024 reached 228.5 GW, marking a significant annual increase of 17%. By September 2023, the installed capacity had expanded to 425.4 GW, showing growth from the 407.8 GW recorded in the same month the previous year.
Harsh Shah, Chief Executive Officer and Whole Time Director of IndiGrid, said, “I am pleased to report that we have reported yet another quarter of strong financial performance. Our robust operations, accretive, and landmark acquisition of VRET have allowed us to increase solar capacity fivefold and increase the Distribution Per Unit (DPU) to ₹3.55 in this quarter itself.
Shah added, “We are pleased to announce that IndiGrid is venturing into the space of battery storage and has received LOI/LOA for BRPL BESS bid of 20 MW /40 MWh. Going forward, we will continue to focus on generating superior and sustainable returns for our investors on the back of our AAA-rated balance sheet, resilient operations, and accretive acquisitions.”
For the first half (1H) of the year, IndiGrid recorded a profit of ₹126.5 billion ($1.52 billion), a 30% YoY decrease from ₹180.6 billion (~$2.17 billion).
The company’s revenue for 1H stood at ₹92.68 billion (~$13.24 billion), a 15.9%YoY decrease.
IndiGrid also announced that the International Finance Corporation invested ₹11.4 billion (~$138.74 million) in its listed non-convertible debentures. IndiGrid intends to use this debt to fund its refinancing needs for the fiscal year 2024.