Greenko Energies Private Limited

Transcription

1 Greenko Energies Private Limited January 11, 2017 Ratings Amount Long-term Bank (enhanced from ) Long-term/Short-term Bank Total (Rupees Nine hundred and forty one crore only) Details of instruments/facilities in Annexure-1 Rating 1 CARE A+; Stable (Single A Plus; Outlook: Stable) CARE A+; Stable/CARE A1+ (Single A Plus; Outlook : Stable/A One Plus) Rating Action Revised from CARE A (Single A) Assigned Detailed Rationale The revision in the long term rating assigned to the bank facility of Greenko Energies Private Limited (GEPL) takes into account infusion of equity by the promoters, group s significant increase in operational capacity resulting in increase in the generation of power which translated in improvement in the total operating income during FY16 (refers to the period April 1 to March 31) at consolidated level. The rating continues to derive strength from strong parentage at its ultimate holding company level with majority of stake being held by Cambourne Investment Pte. Limited (an affiliate of Government of Singapore Investment Corporation), experience of the promoters, established track record of the group in owning and operating diversified portfolio of renewable energy assets, strong ability of the group to access international debt market and economic benefits thereof, experience in executing large scale renewable energy projects, availability of the long-term off-take arrangement for most of the operating and under construction projects, comfortable operating cycle and stable outlook for the renewable power sector. The rating is, however, constrained by deterioration in capital structure, net loss incurred in FY16, project implementation risk related to various under construction projects and large debt-funded capex. Timely execution of the existing construction phase projects without any cost/time overrun, timely realization of the receivables from Discoms along with improvement in financial risk profile will be the key rating sensitivities. Detailed description of the key rating drivers Greenko Group was co-promoted by Mr. Anil Chalamalasetty and Mr. Mahesh Kolli in 2006, with the objective of owning and operating clean energy facilities. The group owns and operates renewable energy plants in India through GEPL. The Greenko group has a diversified portfolio of renewable energy assets spread across biomass, hydro-electric, wind, solar and natural gas-based power plants. As on December 31, 2016, GEPL at a consolidated level had cumulative installed capacity of MW and the group cumulatively had installed capacity of hydro, wind, solar and biomass projects of MW. The Greenko group with over a decade and a half years of experience has garnered strong capabilities of executing relatively large projects. Total operating income of the company grew by about 26.60% in FY16 vis-à-vis FY15 on account of commercialization of projects leading to improvement in installed capacity and increase in power generation. Accordingly, the PBILDT margin also improved during FY16. The capital structure of the company was leveraged as on March 31, 2016 at the back of increased debt availed for the ongoing capex during FY16. As most of the projects have Power Purchase Agreements (PPAs) with state electricity board s where in the collection period is generally elongated. Collection period of the company increased from 57 days in FY15 to 71 days in FY16. 1 Complete definition of the ratings assigned are available at and other CARE publications 1 Credit Analysis & Research Limited

2 Encouraging policy framework in renewable energy (RE) sector has resulted in rising share of installed capacity of RE from 5.9% of total energy capacity (approx. 7.7 GW out of 132 GW) as on March 31, 2007 to around 14% as on March 31, Analytical approach: CARE in its analysis has considered the consolidated business and financial risk profiles of Greenko Energies Private Limited (GEPL) and all its subsidiaries together referred to as Greenko group, as the entities are linked through a parentsubsidiary relationship and collectively have management, business & financial linkages. Applicable Criteria Criteria on assigning Outlook to Credit Ratings CARE's Policy on Default Recognition Criteria for Short Term Instruments Rating Methodology - Infrastructure Sector Ratings Financial Ratios - Non-Financial Sector Private Power Projects About the Company Incorporated in July 2000, Greenko Energies Private Limited (GEPL) is wholly owned subsidiary of Greenko Mauritius Ltd. (Greenko Mauritius), which is in turn is a subsidiary of Greenko Energy Holdings (GEH). Currently, Government of Singapore Investment Corporation (GIC) through its subsidiary Cambourne Investment Pte Limited, Abu Dhabi Investment Authority (ADIA) and Greenko Ventures Limited (GVL) and its associates hold stake in GEH. By Q1FY17, GEH raised $230 million - (in fresh funding in the form of equity out of which $150 million is invested by ADIA and remaining $80 million by GIC (parent company)). Currently, Cambourne Investment Pte. Ltd (an affiliate of GIC) holds ~61%, Abu Dhabi Investment Authority (ADIA) holds ~16% and the founders through GVL and its associates hold ~23% of stake in Greenko Energy Holdings. Greenko group owns and operates renewable energy plants in India through GEPL. GEPL is the holding and funding arm for all the wind, hydro and natural gas &biomass projects under various subsidiary companies; and also has two 6 MW operating biomass power plants in India. The group is one of the leading operators of clean energy projects in India. As on December 31, 2016, Greenko Group s portfolio of assets consists of (i) 47 operational projects with a combined installed capacity of 1,280 MW, comprising 20 operational hydro power projects with a total installed capacity of 284 MW, 12 operational wind energy projects with a total installed capacity of 714 MW, 8 operational solar projects with a total installed capacity of 204 MW and 7 operational thermal projects (which include biomass and gas) with a total installed capacity of 78 MW; (ii) 24 projects under construction with a total licensed capacity of 1343 MW, comprising 4 hydro power projects with a total licensed capacity of 154 MW and 4 wind energy projects with a total licensed capacity of 489 MW, 16 solar energy projects with a total licensed capacity of 700 MW. By Q3FY17, Greenko Group has acquired operational and under construction/development Indian portfolio (Solar and Wind assets) of SunEdison Group comprising about 204 MW of operational assets and about 1000 MW under construction/development assets. With the acquisition of Indian assets of SunEdison Group, the current operational capacity of the Greenko Group stands at about 1.28 GW. During FY16 (refers to the period April 1 to March 31), GEPL at consolidated level has reported PBILDT of crore on a total operating income of Rs crore. However, GEPL incurred net loss of Rs crore. Status of non-cooperation with previous CRA: The suspension of ratings of Greenko Energies Private Limited by CRISIL Limited vide their press release dated May 02, 2013 is on account of non-cooperation by the company with CRISIL's efforts to undertake a review of the ratings outstanding. Any other information: Not Applicable Rating History for last three years: Please refer Annexure-2 2 Credit Analysis & Research Limited

3 Note on complexity levels of the rated instrument: CARE has classified instruments rated by it on the basis of complexity. This classification is available at Investors/market intermediaries/regulators or others are welcome to write to for any clarifications. Analyst Contact: Name: Vidhyasagar L Tel: Mobile: vidhya.sagar@careratings.com **For detailed Rationale Report and subscription information, please contact us at About CARE Ratings: CARE Ratings commenced operations in April 1993 and over two decades, it has established itself as one of the leading credit rating agencies in India. CARE is registered with the Securities and Exchange Board of India (SEBI) and also recognized as an External Credit Assessment Institution (ECAI) by the Reserve Bank of India (RBI). CARE Ratings is proud of its rightful place in the Indian capital market built around investor confidence. CARE Ratings provides the entire spectrum of credit rating that helps the corporates to raise capital for their various requirements and assists the investors to form an informed investment decision based on the credit risk and their own risk-return expectations. Our rating and grading service offerings leverage our domain and analytical expertise backed by the methodologies congruent with the international best practices. Disclaimer CARE s ratings are opinions on credit quality and are not recommendations to sanction, renew, disburse or recall the concerned bank facilities or to buy, sell or hold any security. CARE has based its ratings/outlooks on information obtained from sources believed by it to be accurate and reliable. CARE does not, however, guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. Most entities whose bank facilities/instruments are rated by CARE have paid a credit rating fee, based on the amount and type of bank facilities/instruments. In case of partnership/proprietary concerns, the rating /outlook assigned by CARE is based on the capital deployed by the partners/proprietor and the financial strength of the firm at present. The rating/outlook may undergo change in case of withdrawal of capital or the unsecured loans brought in by the partners/proprietor in addition to the financial performance and other relevant factors. Annexure-1: Details of Instruments/ Name of the Instrument Fund Based - LT-Term Loan Non-Fund Based - LT/ Date of Issuance Coupon Rate Maturity Date - - September 2022 Size of the Issue Rating assigned along with Rating Outlook CARE A+; Stable CARE A+; Stable / CARE A1+ Annexure-2: Rating History of last three years Sr. No. Name of the Instrument/Bank 1. Fund Based - LT-Cash Credit Type Current Ratings Amount Outstanding Rating Rating history assigned in LT )Withdrawn )CARE BBB- (12-Nov-13) 2)CARE BBB- (03-Apr-13) 2. Non-Fund Based - LT/ LT/ST )Withdrawn 1)CARE BBB- / CARE A3 3 Credit Analysis & Research Limited

4 (12-Nov-13) 2)CARE BBB- / CARE A3 (03-Apr-13) 3. Fund Based - LT-Term Loan LT CARE A+ 1)CARE A (13-Apr-16) - 1)CARE A Non-Fund Based - LT/ LT/ST CARE A+; Stable / CARE A Credit Analysis & Research Limited

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