Inox returns to profitability

INDIA: Following a "painful" transition period, Inox Wind posted profitable for the first time in more than a year.

Inox Wind has an order book of 950MW from capacity secured at national and state auctions
Inox Wind has an order book of 950MW from capacity secured at national and state auctions

The manufacturer’s first-quarter earnings before interest, taxation, depreciation and amortisation (Ebitda) of INR 700 million ($10.2 million) marked a dramatic increase from a loss of INR 130 million in the corresponding period one year earlier.

It was also the first time its Ebitda was in the black since the fourth quarter of India’s 2017 financial year (1 January 2017 to 31 March)

Inox claimed it achieved this as it began carrying out orders for projects won in the first Solar Energy Corporation of India (SECI) tender held in February 2017.

It had won 250MW of capacity in the tender and then received an order for 50MW from developer Adani Green Energy, which had also secured capacity.

Inox had revenues of INR 4.3 billion ($62.7 million) in the first quarter of its financial year – more than a three-fold increase on its income in the same period 12 months ago.

Devansh Jain, Inox’s executive director, said: "The April-June quarter has shown a turnaround on the profitability front after a painful transition period of the last 12 months, led by the start of execution of our SECI-1 project.

"With the 2018 financial year firmly behind us, we look forward to this year with renewed vigour and enthusiasm to reap the benefits of the regime change with an improvement in the inventory, receivables, working capital parameters and increased profitability for Inox Wind."

Inox has an order book of 950MW – made up of capacity it had secured itself in the first four SECI auctions and the state tender in Maharashtra, and of capacity awarded to developer Adani.

It intends to carry out these orders over the next 12 to 18 months, translating into revenue for the 2019 and 2020 financial years of more than INR 65 billion ($948 million).

The company also stated that it is in discussion with other independent power producers (IPPs) successful in the third and fourth national tenders and in state auctions.

Combined, the potential orders could be more than 600MW, it added.

Jain added that with India’s plans to auction 10GW each year until 2028, turbine manufacturers such as Inox had "strong visibility on order inflow".

He added: "This should result in a period of sustainable and strong growth for the Indian wind sector."

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