Quarterly Finances

Renewable energy companies continue to reel from the impact of the Covid-19 pandemic. While the priority status granted to the renewable energy sector provided a cushion to many companies, the impact was still significant for some, given the economic slowdown and changes in demand. Issues such as pending dues from discoms and delayed project timelines still plague the industry.

Renewable Watch analyses the financial results of select renewable energy companies for the July-September 2020 quarter, and assesses their growth prospects…

Azure Power Limited

Founded in 2008, Azure Power is one of the leading solar companies in the renewable energy sector. It has a portfolio of 7 GW, which is at various stages of implementation. Of this, letters of award have been received for 4 GW of projects, although the power purchase agreements are yet to be signed. They are expected to be signed following the finalisation of the power sale agreements. The operating capacity of the company stood at 1,834 MW, as of September 30, 2020, an increase of 2 per cent over September 30, 2019.

During July-September 2020, the company’s total income from operations grew by about 23 per cent to stand at Rs 3,504 million as against Rs 2,846 million recorded in the corresponding quarter in 2019. The rise in revenue can be attributed to the commissioning of new projects during this period. Azure Power’s net loss stood at Rs 368 million as of end September 2020, an improvement over the Rs 756 million recorded in the previous year. During the quarter, Azure Power’s results were negatively impacted by an increase in stock appreciation rights expense by Rs 492 million due to a 87 per cent increase in the share price during the quarter.

Inox Wind Limited

Wind turbine manufacturer and project developer Inox Wind registered a total operational income of Rs 1,766.20 million during the quarter ended September 2020, as against Rs 1,433.2 million in the corresponding quarter in 2019, an increase of 23.2 per cent. However, the net loss for the quarter increased by about 67 per cent to stand at Rs 760 million in September 2020, against a net loss of Rs 456 million in September 2019.

The company’s operating capacity stands at 1,366.7 MW. Following a heavy dip, the company progressively ramped up operations despite a heavy monsoons pan-India and has now normalised operations across all plants. Manufacturing operations have been fully established at the newly set up plant in Bhuj, Gujarat, and are in full swing. During the quarter, the company won orders for 24 MW of capacity from various retail customers and signed significant deals, which are at the final stages of closure. Besides, the company raised Rs 1,950 million by issuing non-convertible debentures (NCDs) at 9.5 per cent. The proceeds were utilised inter alia to optimise the working capital and retire high-cost debt. The company is also in the process of raising long-term funds by issuing NCDs amounting to Rs 1,990 million, the proceeds of which will also be used for retiring high-cost debt and optimising the working capital.

Orient Green Power

Orient Green Power Company Limited’s (OGPCL) net profit declined by about 42 per cent to Rs 217 million in the quarter ended September 2020, as against Rs 373 million in the quarter ended September 2019. Its total revenue declined by about 22 per cent to Rs 1,051 million from Rs 1,351 million during the quarter ended September 2019. The company’s continued losses can be attributed to the unpaid dues of state distribution companies, especially Tamil Nadu and Andhra Pradesh discoms. It also allocated 150 MW of installed capacity under the renewable energy certificate (REC) scheme, but the market value of RECs was very low until recently. Moreover, owing to regulatory hurdles in Andhra Pradesh, one of OGPCL’s wholly owned subsidiaries could not proceed with the construction of the planned Phase III of a wind power project. The company hopes to recover a substantial portion of its capital investment.


Suzlon is one of India’s major wind turbine manufacturers. Of the 2.95 GW of wind capacity commissioned in India under Solar Energy Corporation of India and state bids, about 19 per cent has been developed by Suzlon. This is the second highest in the country. The company witnessed a decline of around 9.8 per cent in its total operational income during the quarter ended September 2020 over the previous year. However, the company’s net profit witnessed an upturn. It recorded a net profit of Rs 6,747 million, which is a substantial 186 per cent increase over a loss of Rs 7,778 million in the corresponding quarter of 2019, and a 270 per cent increase over the quarter ended June 2020.

The successful completion of its debt restructuring helped Suzlon reduce its fixed costs in 2019-20, thereby bringing down its break-even levels significantly. This was the first quarter post the closure of its debt restructuring process. The quarter marked the restart of its operations and its entry back into the market amidst the Covid-19 pandemic. Suzlon’s six facilities started production in line with the Covid-19 protocol. The company also restarted the supply of turbines this quarter. Overall, the company’s service business continues to do well and all wind farms have been functioning without interruption. SE Forge, Suzlon’s forging and foundry business, is also securing good orders.

Sterling & Wilson Solar

The net profit of EPC company Sterling & Wilson declined by 81 per cent, from Rs 794.1 million in the quarter ended September 2019 to Rs 150.9 million in the quarter ended September 2020. However, the company’s total income increased by about 8.7 per cent, from Rs 12,656 million to Rs 13,759 million. The company has contracted a cumulative capacity of 8 GW for operations and maintenance as of November 12, 2020.

Post the launch of the company’s initial public offering (IPO) in August 2019, the promoters have found it difficult to deliver on payments due to the significant and rapid deterioration of credit markets, resulting in a significant liquidity crisis. Further, the IPO registered lower-than-expected realisation, although low working capital requirements have limited its impact on profits. The execution of projects picked up pace in the quarter ended September 2020, resulting in improved revenue. The overhead costs also reduced owing to cost efficiency measures taken by the company and the reduction in travelling costs.


While Azure Power, Inox Wind, OGPCL and Sterling & Wilson witnessed a dip in financials during the quarter ended September 2020, Suzlon continued to thrive. It took on more capacity, which is to be implemented in the coming months. After restructuring, Suzlon significantly improved its financial position, turning a strong profit during the quarter, whereas Sterling and Wilson slipped financially.

Going forward, the impact of the Covid-19 lockdown on revenue and margins is slowly abating. Inox Wind believes that the long-term impact of the Covid-19 outbreak on its business and financial position will not be significant since its activities fall under a priority sector.

In sum, renewable energy companies have been monitoring the Covid-19 situation and taking the requisite steps to address the situation. They are gradually resuming their operations and going back to pre-Covid levels although getting their balance sheets back on track will take some more time.

By Meghaa Gangahar


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