INOXWIND — earnings call
The transcript as filed. Every paragraph is addressable: its link names the page and the position it sits at in the call.
Prepared remarks
LIMITED · MR.
MR.
JITENDRA · MOHANANEY
MOHANANEY –
GROUP · FINANCIAL
FINANCIAL CONTROLLER – INOX WIND LIMITED MR. NARAYAN LODHA – CHIEF FINANCIAL OFFICER – INOX
WIND LIMITED · Management
INOX Wind Limited May 20, 2019
Questions and answers
r?" I“) · Research Analyst
“Inox Wind Limited
Thank you Aman.
I would like to welcome everyone on this call.
We have with us Mr. Devansh Jain, Executive Director, Mr. Jitendra Mohananey – Group Financial Controller and Mr. Narayan Lodha, Chief Financial Officer.
I would request Mr. Jitendra to take us through the key highlights of the results post which we will open the floor for Q&A.
Over to you Mr. Jitendra.
JITENDRA · MOHANANEY
Thanks Ojasvi.
Good afternoon, I welcome all the participants of this earnings call.
The Board of Directors of Inox Wind Limited approved the quarterly and annual results of FY2019 in meeting, which was held on May 18, 2019.
I trust you would have had an opportunity to go through the results.
I request our Executive Director, Mr. Devansh Jain to give you an overall perspective of the year gone by.
Devansh Jain
Thank you Jitendra.
I am going to give an overall perspective of the year gone by and then Jitendra is going to take you through the details of quarter gone by as well as some more nitty-gritty details of the year gone by and then we will open up the floor to questions.
In terms of the year gone by and talking of the financial numbers, we have seen a significant year-on- year turnaround in topline and EBITDA margins on the back of our SECI execution, which was despite over 15 months of delay in the central grid’s evacuation readiness.
For everybody’s information, the central grid was finally commissioned on April 14, 2019 by the central grid authorities and since then we can now progress going forward with our execution.
In terms of revenue for the full financial year, our revenues were Rs.1437 Crores, which was up 200% against revenues of Rs.480 Crores in FY2018. Our EBITDA profit for the year was Rs.156 Crores against EBITDA loss of Rs.81 Crores in the corresponding period of the previous financial year.
Our cash profit was Rs.27 Crores in FY2019 against cash loss of Rs.133 Crores in FY2018. In terms of operations, naturally post a virtual shut down in FY2018, which was impacted by the transition from the feed-in tariff regime to the auction regime, in FY2019 supplies have begun towards SECI-1.
Large scale supplies have been muted during this financial year due to the delay in the central grid infra readiness.
Finally after 15 months of delay, with the central grid now ready, Inox is well poised to commission our SECI-1 project over the next couple of weeks at Dayapar in Gujarat.
For everybody’s information, our common infra in Dayapar, Gujarat is large enough to enable us to commission over 600 to 700 megawatt of capacity, which can now be implemented on a plug and INOX Wind Limited May 20, 2019 play basis as we move forward.
Another interesting point for our operations, as we move forward, is that a significant part of our operating fleet is beyond the warranty and free-O&M period.
So we believe our O&M revenues will pickup significantly in the new financial year.
In terms of technology, we did announce that in the last quarter we entered into a technology agreement to launch the 3.3- megawatt wind turbine.
This turbine is a globally operating and proven platform, which will significantly improve energy yields and further reduce the levelized cost of electricity.
With this Inox Wind will have the technology platform in place for the future, well ahead of competition.
Over the year building on our strong relationship with Adani Green, we received an LOI for equipment supply for 501.6-megawatts of our 3.3-megawatt wind turbines.
We have also signed an agreement with a leading MNC IPP who is our existing customer for an initial supply of 23.1-megawatt on this 3.3 megawatt platform and we expect to keep this momentum going forward as we launch the 3.3 MW turbine in the Indian market.
Recently we have also won 40 megawatt auction under the Gujarat state auction at a tariff of Rs.2.95.
So as you can see over the past three or four auctions, tariff has been moving up and stabilizing in the market.
With this our cumulative order book stands at approximately 1250 megawatt having a value of upwards of Rs.7000 Crores.
These are the annual highlights for our operations and finance for the year gone by.
I would now request Jitendra to take you through the details of the quarter gone by as well as for the full financial year.
JITENDRA · MOHANANEY
Thanks Sir.
In terms of financial results for the year, we ended FY2019 with consolidated revenue of Rs.1437 Crores as compared to Rs.480 Crores in the previous year FY2018. We have an EBITDA profit of Rs.156 Crores as compared to EBITDA loss of Rs.81 Crores, cash profit of Rs.27 Crores as against cash loss of Rs.133 Crores and have a PAT loss of Rs.39 Crores as compared to a PAT loss of Rs.185 Crores in the previous financial year 2018.
FY2019 results reflect the beginning of sale under the auction regime post FY2018 wherein there was a virtual shutdown of operations due to transition from FIT regime to auction regime.
In terms of the financial results for the quarter, we ended the quarter with consolidated revenue of Rs.180 Crores as compared to Rs.203 Crores in the corresponding quarter of the previous year FY2018. We have an EBITDA loss of Rs.28 Crores as compared to EBITDA loss of Rs.30 Crores, cash loss of Rs.36 Crores as against cash loss of Rs.43 Crores and have a PAT loss of Rs.53 Crores as compared to PAT loss of Rs.55 Crores in the corresponding quarter of the previous year.
Supplies in Q4 FY2019 were cut back since the central grid was further delayed beyond Q4, which was finally made ready on April 14, 2019.
In terms of sales, to a large extent the sales and commissioning during the quarter were impacted due to central grid connectivity delays, which has led to a deferment of commissioning revenue and supply revenue.
With the readiness of central grid finally in April 2019, after a delay of over 15 months, Inox Wind is poised to commission SECI-1 project in the next couple of weeks in Dayapar, Gujarat.
Our common infra at Dayapar, Gujarat will INOX Wind Limited May 20, 2019 enable us to commission over 600 megawatt on the same infrastructure.
Accordingly execution of orders beyond SECI-1 will virtually be plug_and_play.
On the balance sheet front, I would like to bring to your notice slide 11 and 12 of the presentation, which gives details of our focus on balance sheet improvement during the quarter and past couple of quarters before that.
Consolidated inventory levels increased mainly on account of ramp up of SECI project execution since the current inventory includes project work in progress of Dayapar, Gujarat site, which will be commissioned over coming quarters given the central grid is now ready.
Going ahead we expect inventory levels to come down as the execution picks up pace in the coming quarter.
Inventories will also be consumed towards SECI-2 now that common infra in place.
There is a reduction in receivables by Rs.185 Crores in quarter due to continued collection from past receivables.
The closing receivables include significant part of sales made during the current financial year wherein collections were delayed due to substantial delay in readiness of central grid over 15 months.
The grid as intimated was finally made ready on April 14, 2019.
Commissioning activities for SECI-1 projects are in full swing and we expect increased realization from receivables post commissioning.
At the end of Q4 FY2019 in terms of working capital, inventory stood at Rs.944 Crores, net receivable at Rs.1261 Crores, payable at Rs.889 Crores; and others are about Rs.103 Crores.
This translates into net working capital of Rs.1213 Crores.
Despite the huge delay in the central grid readiness, working capital levels have been maintained at the same level.
With a grid now finally in place, further efficiency will kick in.
On the debt equity front, we ended the quarter at a net debt-to- equity ratio of 0.47x.
The shareholding structure is 75% belonging to the promoters and promoter group, FIIs own 7%, DIIs own 6% and public is 12%.
So this is a brief snapshot of our operations.
I would like to spend some more time in talking to you about competitive intensity, technology, order book, industry and how we see going forward.
In terms of competition in the wind sector, over the past two years many players have either closed or virtually closed operations and some are facing severe financial crisis.
Inox Wind is probably the only successful Indian company to have survived during the huge downturn and turbulent period faced by the wind sector.
Due to the lower intensity of competition going forward, we expect to get back to normalized profit level.
In terms of technology, as we told you that we have achieved significant milestones by entering into technology agreement to launch the next generation 3.3-megwatt wind turbine with a 146 rotor diameter, this will probably be the largest rotor diameter available in country and will set new benchmarks in Indian wind industry.
The 3.3-megawatt wind turbine platform will further reduce levelized cost of electricity thereby supporting the government’s vision of larger footprint for Green energy.
Hence, despite the fall in tariff under the auction regime, Inox Wind will INOX Wind Limited May 20, 2019 continue to maintain healthy margin.
We have a strong order book of 1250.7 megawatt having a value of over Rs.7000 Crores to be executed in a period of next 18 months or so.
The other significant feature that is happening is that in the O&M annuity business, a large part of the fleet has gone off their free-warranty period and hence O&M revenue in terms of cash flows would start flowing in.
O&M revenue will further get stronger in coming years as the fleet size increases on the back of a strong auction order inflow.
These revenues as you know are non-cyclical in nature, they have a steady cash flow generation and have significant higher margins than average company margins and hence would help in our margins profile as well.
In terms of project sites, we continued to be amongst the largest project site holders in the state of Gujarat, Rajasthan and MP.
We have sufficient project site inventory as of March 31, 2019 for installation of more than 5000 megawatt.
In terms of manufacturing capacity, our blade manufacturing capacity stands at 1600 megawatt and with minor capex we can debottleneck our nacelle and hub capacity from current 1100 megawatt to match blade capacity.
The sector is moving ahead towards a regime of sustainable volume and growth post witnessing a painful transition over the past few quarters.
So that is the broad overview of our operations and financial performance and how we see the sector going forward.
I have along with me Mr. Devansh Jain who has already given the highlights of FY2019 and our CFO, Mr. Narayan Lodha to take questions now.
Thank you very much.
Moderator · Conference Operator
Thank you very much.
Ladies and gentlemen we will now begin the question and answer session.
The first question is from the line of Mohit Kumar from IDFC Securities.
Please go ahead.
Mohit Kumar
Sir if FY2019 is pretty bad for us in the sense of turnaround, but this Q4 expecting slightly better execution, just trying to figure out whether SECI-1 has put the entire SECI-1 in the entire four quarters given that our topline is Rs.1400 Crores so it seems like SECI-1 entirely booked or some part of the SECI-1 is still remaining and how do you see this SECI-2 moving forward, trying to figure out how the FY2020 will look like?
Devansh Jain
Okay Mohit, obviously we would have expected Q4 to have been stronger as well, but unfortunately the grid has taken over 15 months to commission.
Just to recap, the grid was supposed to be ready in January 2018 then we were given a timeline of June 2018 then August, then November, then December, then finally told that it would be done in January 2019, then again it was promised for February and effectively finally it got readied only on April 14, 2019, so naturally speaking there is no point supplying more and more in the market without people paying you and without having any clarity as to when the grid gets ready.
Having said that, finally the grid is being made ready, so naturally now we are executing much more.
So to a great extent if you look at our inventory and lot of that inventory is including all the project execution work in progress, which we have done on the ground, which will get recognized as commissioning revenue once we commission these turbines.
We INOX Wind Limited May 20, 2019 expect commissioning of SECI-1 to happen over the next few weeks so that will answer your question on revenue booking.
Now revenue of this year of SECI-1 supply has been booked, but commissioning revenue to that extent is not booked because commissioning revenue is recognized only once commissioning takes place, that is point number one.
With respect to how we see SECI-2 moving forward, as soon as we ramp up now SECI-1 over the next few weeks we will be starting supplies and execution of SECI-2 which to some extent already exists because common infra is capable of taking more than 600 megawatt of capacity so we really do not need to build anymore common infra on site and in fact a lot of 33 KV lines, pathways and other stuff built on site is capable of taking SECI-2 and even projects beyond SECI-2 so that is how we see SECI-2 moving forward.
Mohit Kumar
Sir my second question pertains to this 500-megawatt LOI from Adani.
So when do you expect it to be got into a proper agreement and I believe that this is SECI-3 and SECI-4, so this entire thing should ideally get let us say get booked in our revenues in FY2020?
Devansh Jain
I do not know whether it is SECI-3 or SECI-4 because that is Adani’s call.
They have won a whole host of auctions ranging from SECI 1 to NTPC to Gujarat to MSEDCL, so to be honest I am not in a position to answer whether this is SECI-3 and SECI-4, but yes this will get converted into an agreement naturally as we put up the first 3-megawatt product on the ground and that is expected over the next few months.
I think we are moving, for competitive reasons actually I am not going to spell out exact timelines and what the action plans are, but I think broadly speaking we are well on track with respect to what we wanted to achieve on the ground with respect to the 3-megawatt product.
Naturally speaking we could have fast tracked this much more and done a lot of things six months or year earlier, but please do keep in mind without auction guidelines being announced in the Indian market, without regulatory clarity and obviously, without grid infrastructure being ready, even if we had this product available a year ago nothing much would have been achieved so I do not want to run ahead of myself, but I think we have been very cautious in terms of how we are moving forward.
We are finally reaching a point where all our inventories are going to get consumed, do not forget that for the past two years we have been saddled with huge inventory and no avenue to utilize them because there was no market, but I think things are finally moving fine and I think over the next few months, we should have this 3-megawatt converted into a firm agreement with supplies happening.
Adani has been very supportive and they are backing us and have been an integral part of this 3-megawatt product.
Mohit Kumar
One last question Sir, out of 12.8 gigawatt auction which has happened, what is your sense how much order is still to be placed, in the sense closed?
Devansh Jain
First and foremost what we understand is, that about 1 gigawatt out of 12.8 is all that has been commissioned barring some 300, 400 megawatt of stranded assets if you look at, all the commissioning in the previous financial year FY2018. In the current financial year, which has gotten INOX Wind Limited May 20, 2019 over, we did about 1400 to 1500 megawatts of commissioning as an industry.
About 800 odd megawatt was under various auctions and another 600 odd with some state auctions of Gujarat and Tamil Nadu where some people had some stranded assets and partly group captive and third party sale.
So we still have almost 11.5 gigawatt of auction volume, which still needs to be implemented on the ground.
Mohit Kumar
How much of this order has already been placed out of 12.8 gigawatt?
Devansh Jain
It is very hard to answer how much of it has been placed because I would say about a gigawatt to 2 was placed on some parties, which have gone insolvent or declared bankrupt, so to that extent while that order exists on paper, all those orders actually do not exist and those IPPs are now scouting around for supplies..
Secondly, there was also another basket of volume and another gigawatt to 2, which has been placed on one or two manufacturers who are facing very severe financial crisis and what we understand from the market, these are also being opened up for supply given the fact that in case the grid for SECI-3 and SECI-4 is also delayed there is a lot of time available for people to supply this.
All in all is I may put it, I think out of the 11 to 12 gigawatt yet to go I think it is at least if not more, 5 to 6 gigawatt will be available for people to effectively step in and supply.
Mohit Kumar
Okay thank you Sir.
Moderator · Conference Operator
Thank you.
The next question is from the line of Ketan Gandhi from Gandhi Securities.
Please go ahead.
Deepm ga · Research Analyst
Sir any clarity on the penalty, which may or may not be faced by us or the IPP for delay in the execution of SECI-1 and SECI-2?
Devansh Jain
Well I think with respect to SECI-1 and SECI-2 won by us, but in terms of penalty what we have been made to understand is given the fact that grid has only been ready on April 14, 2019, we have a certain grace period within which we need to commission this and if we do achieve that, there will be no penalty, if at all there is a penalty, it may be for 10 to 15 days, which will work out to a Crore to 2 or so.
Deepm ga · Research Analyst
SECI-2?
Devansh Jain
With respect to SECI-2, there is still some time for that, we are still assessing what that would be, but as we understand there have been various representations made by almost all the winners of SECI-2 and SECI-3 because of delays in evacuation as well as land allotment.
So while we have to get some more clarity on that, but as things stand we believe there would be an extension available for that as well.
They have already given extension across players for SECI-3 and SECI-4 because no one’s grid is ready for SECI-3 and 4 virtually nobody’s grid is ready for SECI-3 and 4 yet.
INOX Wind Limited May 20, 2019
Deepm ga · Research Analyst
No, that is okay, but SECI-2 because which is the deadline is already over?
Devansh Jain
No, deadline for SECI-2 is May, but within that we have a certain period where certain things have been delayed, you get an extension.
So I think what we understand that everyone has made a request for extension and I think as we move towards commissioning I think we will be granted extension for X amount of period, hard to quantify what that period could be, but if at all there is we could face a penalty of few Crores rupees there.
Deepm ga · Research Analyst
Alright and Sir we have signed agreement with MNC IPP.
Can you throw some more light on that, I mean it is a long-term relationship or one-off?
Devansh Jain
As we mentioned it is an existing customer and obviously we signed an initial agreement for 23 megawatt.
Naturally speaking I think as we also put out in our presentation the competitive intensity in the market is declining, it is probably down to three or four players now in the Indian market and lot of new players came in and folded up, existing players have folded up.
So clearly everybody wants a long-term strong stable supplier and as we did mention, we are probably the only successful Indian company to have survived this hugely turbulent and painful period, being a defaulter is not called survival because you have got a lot of other companies who defaulted and continue to default.
I suppose NCLT and various other avenues exists for that to get sorted out, but within which I think we are well placed now to rebuild a strong position in the market.
Deepm ga · Research Analyst
Any ballpark figure that we may achieve this financial year of supply and the commissioning in terms of number of megawatt?
Devansh Jain
Well I would not give any forward looking statements but I think given the fact that the common infra is now in place for approximately 600 plus megawatt, I think our commissioning numbers would play out within that given the fact that for SECI-3 and 4 grid still needs to be made ready, so that is going to be our ballpark commissioning number and obviously supply to some extent would be guided by that minus what has already been supplied.
Deepm ga · Research Analyst
If I may ask SECI-3 and 4, is that Gujarat only or Tamil Nadu?
Devansh Jain
For us SECI-3 and 4 will be Gujarat.
Deepm ga · Research Analyst
For the same location only?
Devansh Jain
Yes.
Deepm ga · Research Analyst
Okay thank you very much Sir.
INOX Wind Limited May 20, 2019
Moderator · Conference Operator
Thank you.
The next question is from the line of Chetan Dhruva from Blue Banyan Advisors.
Please go ahead.
Chetan Dhruva
Thanks for the opportunity Sir.
I had only one question.
Congratulations on situation changing, so I am pretty sure that you are start seeing results.
Rs.7000 Crores order book that you have, remember last time you talked about 18 to 24 months horizon for that to get executed and revenues to be seen is that still the case with this, how do you see any improvement in that time Sir?
JITENDRA · MOHANANEY
I think Rs.7000 odd Crores of order book, which equals to 1250 odd megawatt, the horizon is around 18 months or so where all those revenues will be recognized in our financial numbers.
Chetan Dhruva
Thank you very much and all the best for the next few quarters.
Moderator · Conference Operator
Thank you.
The next question is from the line of Giriraj Daga from KM Vesaria Family Trust.
Please go ahead.
Deepm ga · Research Analyst
Hi couple of questions from my side, first what was the O&M revenue cash in FY2019 cash revenue?
JITENDRA · MOHANANEY
We will just check and get back to you on that.
Deepm ga · Research Analyst
Okay and what is the FY2020 expecting number to be on O&M side?
JITENDRA · MOHANANEY
FY2020 expected O&M is approximately Rs.120 Crores of cash.
Deepm ga · Research Analyst
What would be your capex for FY2020 including common infra site?
Devansh Jain
That is not something which we can forecast at the point in time because it is also function of what volumes we are implementing on the ground.
Deepm ga · Research Analyst
Apart from common infra what about the other capex?
Devansh Jain
Just to address whatever capex we incur is kind of knocked off because we get paid eventually and we recognize that revenue.
Pure play capex is only in terms of capex which we make towards plant and machinery and to that extent capex in the financial year is sub-30 to 40 Crores for our 3-megawatt product.
Deepm ga · Research Analyst
For FY2019?
Devansh Jain
FY2020.
Deepm ga · Research Analyst
How is the bidding pipeline looking for the new project over the next one year?
INOX Wind Limited May 20, 2019
Devansh Jain
Well I think there are almost 13 gigawatts of bidding, which has already been done and as I mentioned only about a gigawatt or gigawatt and half of that has been implemented, so irrespective of the bidding pipeline which also looks very robust and strong, there is already such a massive pipeline, which exists, which needs to be implemented that market size is the least of worries honestly for anybody, if you notice for the past two years the biggest worry has been regulatory guidelines, that took about a year and then for the past one year everyone has been sitting for the grid infra to be made ready.
Even if there is another 10-gigawatt of bidding let us say over the next six months you also have to have the grid infra ready, otherwise people will keep winning bids without any implementation on the ground.
Deepm ga · Research Analyst
Correct, so that was my next point.
So like you have added about 3 to 5 gigawatt of implementation, do you think that infra is available for the next let us say FY2021 to be 5+ gigawatt of commissioning to complete this existing 12-13 gigawatt of ordering?
Devansh Jain
Well I think over the next one to two years, like for example now SECI-1 infra in our case is ready, which we will use for SECI-2 also.
For some people some infra is being readied in August and September, Adani Infra is also being readied around that time, they are not ready yet.
There are some other IPPs whose infra is going to be ready by year end and then you have a couple of others whose central grid infrastructure is being readied sometime in calendar year 2020.
So I think broadly speaking if you look at the next two financial years 2019-2020 and 2020-2021, I think we should have common infra in place for at least 8-odd gigawatt, that is number one and of course within this order pipeline, some of them are state bids like for example the bids recently concluded Gujarat state bid, where people evacuation can be built very rapidly because the common infra already exist for state bid for example 40 megawatt, which we won, we are going to put it up on one of our existing sites in Gujarat where the common infra already exists.
Deepm ga · Research Analyst
Okay.
Devansh Jain
So state bids will be much quicker than central grid.
Deepm ga · Research Analyst
So do you believe that 5+ plus gigawatt in FY2021 is possible?
Devansh Jain
In FY2021 yes, in FY2020 it could be 3 to 5 gigawatt.
Deepm ga · Research Analyst
Okay my last question is on the receivable side of it.
If I look at the gross receivable ,if you can give me the numbers like the outstanding more than year number what is that?
JITENDRA · MOHANANEY
Well we can give you that offline.
Right now, those numbers are not with us so you can send us a mail, there is a mail id at the end of the presentation, you can shoot a mail there and we will respond to you, but a large sum pertains to SECI-1.
INOX Wind Limited May 20, 2019
Deepm ga · Research Analyst
Okay.
Sure.
Thanks a lot.
Moderator · Conference Operator
Thank you.
The next question is from the line of Shivan Sarvaiya from JHP Securities.
Please go ahead.
Shivan Sarvaiya
Good evening sir I had two questions, one is regarding the order book that we have.
We have stated that it is 1250 megawatts with approximately Rs.7000 Crores of revenue potential.
So I was just doing a simple mathematics out here, so per megawatt realizations comes to lesser than Rs.6 Crores, so is this something that we are seeing some pressure in terms of pricing?
Devansh Jain
What you forget is a significant part of that order book is equipment supply.
So under equipment supply we do not do the EPC, so the math which you have done of 7000 divided by 1250 that will not work out because for all the equipment supply orders in the system you will need to add the EPC value, which would be about Rs.1 to Rs.1.5 Crores for megawatt.
If you add that to the system, then you will get average pricing upwards of Rs.6.5 Crores to Rs.6.7 Crores.
Shivan Sarvaiya
Sir in this 1250 order book, majority is with the EPC, right?
Devansh Jain
501 is without EPC.
Shivan Sarvaiya
Except the Adani one?
Devansh Jain
Except the Adani and within the 1250 also we have about 100 megawatt without EPC, so we have 600 odd in this 1250 without EPC.
Shivan Sarvaiya
Okay got it and there is one bookkeeping question out here, there is capitalized expenditure of Rs.27 Crores so if you just could give the nature of that item?
JITENDRA · MOHANANEY
That was small work in progress, which got capitalized, that is all.
There is no additional capex which we have taken, that was in the capital work in progress.
Shivan Sarvaiya
Okay and Sir last one what would be the straight-lining of the O&M that we would have done this year?
Devansh Jain
It is approximately Rs.90 Crores to Rs.100 Crores, but we will just check and get back to you.
INOX Wind Limited May 20, 2019
Moderator · Conference Operator
Thank you.
The next question is from the line of Mayank Sethi, an Individual Investor.
Please go ahead.
Mayank Sethi
Sir my question is, in case our most of the fleet comes in outside the free warranty period, would our EBITDA margins increase beyond 14% to 15%?
Devansh Jain
To be honest, first need to get back to 14% to 15% and I think that is possible once we achieve normalized volumes, for example in FY2018, our sales were only Rs.400 odd Crores, this financial year is up 200% to about 1500, once we reach certain normalized levels, which would be almost about Rs.3000 Crores that is when we achieve EBITDA margins more or less on the basis of our historical numbers and yes as O&M revenues kick in, this would add to that margin.
Mayank Sethi
Like these will be paid by the clients to us?
Devansh Jain
Yes, because we provide services.
Mayank Sethi
Sir my next question is I also needed inventories and receivables figures, ageing of these, anything that is beyond one year, so may be I will e-mail on the e-mail id provided in the presentation.
JITENDRA · MOHANANEY
We will do that.
Mayank Sethi
Sure Sir and under SECI bids, what is the contracted receivables period?
Narayan Lodha
SECI revenue normally comes under three months.
Mayank Sethi
But that is between IPP and SECI.
I also needed the breakdown of our finance cost.
This quarter also it is about Rs.45 Crores, so breakdown between interest and other bank charges?
JITENDRA · MOHANANEY
We will do that please send e-mail.
Devansh Jain
What we can share in the public domain we will share with you.
Mayank Sethi
Okay Sir this is all I had Sir.
Good luck for the next quarter.
Moderator · Conference Operator
Thank you.
We have the followup question from the line of Mayank Sethi as an Individual Investor.
Please go ahead.
INOX Wind Limited May 20, 2019
Mayank Sethi
Sir some followup questions thanks for your time again.
Sir this grid connectivity as I understand would be applied for 600 megawatt of execution.
By when we can expect all this 600 megawatt to be executed?
Devansh Jain
The endeavour is to do it as soon as we can, but I assume it will take us about 12 months to consume the entire 600 megawatt that is exactly what I said to one of the other questions where someone had asked what kind of broad execution are we looking at it in this financial year.
Mayank Sethi
And SECI-1, how much is remaining to be executed?
Devansh Jain
We have done all the supplies, we are now doing the final execution in terms of USS, a couple of turbines, number of sets to be erected, few castings to be done, but at this point in time we have got about 3 out of 5 parts done which we are going to be commissioning soon.
Mayank Sethi
Okay Sir, so in this June quarter, approximately how much megawatt we can expect in terms of execution?
Devansh Jain
We would expect to execute the entire SECI-1 in this quarter.
Mayank Sethi
Okay this is all I have.
Thanks again for your time.
Moderator · Conference Operator
Thank you.
Ladies and gentlemen that was the last question.
I now hand the conference over to the management for their closing comments.
Thank you and over to you.
Devansh Jain
Thank you everybody for your time and thank you for being part of our investor conference.
I think the year gone by had started off on a promising note, it took much longer than anticipated in terms of the grid being ready and us being able to consequently ramp up execution, but finally in terms of the full financial year, I think we have achieved significant milestones with respect to now the turnaround in terms of the financials of the company, with respect to the common infra finally being ready for the future as well as we have made a significant milestone on the technology front and on the order book front where we continue to built on order book front.
I think as we move forward we are much better placed from a financial perspective as well as from an execution and regulatory clarity perspective.
I think the years and the quarters to come forward, we would tend to see a significant amount of execution happening on the ground, there have been a very large number of auctions, which have already been conducted as well as a significant auction pipeline, which is in the near future.
I think what is very interesting and which makes us very excited going forward is also the fact that we have a unique position in the market, which has been created primarily for Inox Wind, because a lot of other players in the market have virtually closed operations or are facing severe financial stress.
I think this is somewhat similar to the period in 2013-2014 when we had ramped up execution in the market and captured a fairly large chunk of the market share because there were three or four players, a couple of INOX Wind Limited May 20, 2019 players were struggling financially, one or two had shut down and I think it is virtually a repeat of what is happening in the market at this point in time.
What is naturally the rule under auction regime is that we need to be extremely tight on cost and fit and I think as is well known Inox Wind has been amongst the lowest cost producers of wind turbines globally and we are well prepared to thrive now under the auction regime with a lot of regulatory hassles behind us as well as a lot of grid related issues behind us so we are very excited to finally get back into shape and capture a larger pie of the market as we move forward.
Thank you for being part of the call and we look forward to talking to you all in the next quarter.
Moderator · Conference Operator
Thank you very much.
Ladies and gentlemen on behalf of Axis Capital Limited that concludes today’s conference.
Thank you for joining us.
You may now disconnect your lines.