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India

Inox Wind posts loss in H1

INDIA: Turbine manufacturer Inox Wind has recorded a INR 340 million ($5.25 million) loss in the first half of its 2018 financial year on the back of a downturn in the Indian market due to the shift in tender regimes.

India's policy shift has had an adverse affect on Inox Wind's books, but it is only temporary, the company claimed
India's policy shift has had an adverse affect on Inox Wind's books, but it is only temporary, the company claimed

The H1 loss was down from pre-tax earnings (EBITDA) of INR 1.47 billion in the same period last year.

Revenues in the six months to the end of September also dipped 85% from INR 12.45 billion last year to INR 1.86 billion this year.

The shift to an auction-based system in India has caused a temporary lull in turbine sales and installations in 2017 as developers and financial institutions get to grip with the new rules — and the resulting lower prices.

However, the manufacturer believes this is a temporary downturn, and business will begin picking up during the remainder of this financial year and moving in to the next.

"We anticipate FY19 as the beginning of a phase of robust growth for the wind industry. We believe that Inox Wind, on the back of its cost-competitive advantage of being amongst the lowest cost producer of wind turbines globally, would be a major beneficiary in the auctioning regime," the company said.

The firm has an order book of roughly 550MW on the back of the first two auctions to take place in India this year, which forced prices down to INR 2.65/kWh ($0.041/kWh).

"On expected lines, the continuation of the temporary downturn of the Indian wind power market impacted our Q2 results. We see the wind industry to be in the last phase of transition to a complete auction based regime," said Inox Wind executive director Devansh Jain.

"We expect normalisation, from an order inflow perspective, to commence from Q3 onwards, and execution to pick up from Q4 onwards.

"We are heartened by our win of 250MW in the [latest federal] auction taking our total auction based order book to 550MW.

"From a near term-perspective, we look forward to upcoming [federal] auctions, 500MW Gujarat state auctions and [other public sector] orders for scaling our order book. We believe that our inherent cost-competitive advantage places us in an ideal position to benefit from the auction based market regime," Jain added.

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