Informist, Wednesday, Sep 18, 2024

--Suzlon Tanti: To fund growth internally, avoid raising term debt

--Suzlon Tanti: To expand wind energy capacity to 4.5 GW, from 3.1 GW

--Suzlon Tanti: To expand wind energy mfg capacity to 4.5 GW in 12 mos

By Sunil Raghu

GANDHINAGAR – Suzlon Energy Ltd plans to avoid raising any term debt in the foreseeable future, including for the planned expansion of its capacity by nearly 50% or to finance any inorganic buys, Vice-Chairman Girish Tanti told Informist on the sidelines of an industry event.

Suzlon Energy has overcome a tumultuous last decade to finally become debt-free in 2023-24 (Apr-Mar). The company had a debt of 120 bln rupees on its books in 2019-20, which constrained its growth.

"Without term debt, we got Renom Energy. My business will throw enough cash for me to do what I need. That is how we are redesigning the business," Tanti said. Last month, Suzlon Energy announced that it would buy 2.3 mln shares, or 76% equity stake in Renom Energy Services Pvt Ltd, a multi-brand operations and maintenance service provider to renewable power companies across the country, for 6.6 bln rupees.

Tanti said Suzlon will exercise caution about the kind of companies it acquires a stake in going forward. "When the going is good, the chances of you making mistakes are high. We have put a lot of guard rails now to make sure we do not get wooed by (companies) just like that," he said.

Speaking about the company's organic growth, Tanti said the company would raise its installed wind energy capacity to 4.5 GW, from the current 3.1 GW, in the coming 12 months. While he refused to share details about the funds required to carry out this expansion, Tanti said most of this expansion would take place across its existing 14 manufacturing facilities.

In terms of growth visibility, Tanti said the demand for wind energy installations was on the upswing, with new projects coming up in Rajasthan, Gujarat, Maharashtra, Karnataka, Andhra Pradesh, and Tamil Nadu. The Suzlon vice-chairman said the total order book of the company stands at 5 GW as of today. Last week, it had bagged one of the country's largest wind energy order of 1.17 GW from NTPC Green Energy Ltd, a subsidiary of NTPC Ltd.

Tanti also dubbed the issue of corporate governance raised recently by a board member as "done and dusted". In June, Marc Desaedeleer, an independent director on the company's board, resigned from the board while raising concerns regarding compliance and transparency. Tanti said the audit committee set up to look into the issues had already submitted detailed recommendations, which are being implemented by the company. "..we have developed various layers of checks and balances across many areas of business, technical, finance, commercial, legal...so there are cross-checks and balances... There is so much being done to strengthen the overall governance across the organisation to make sure that we have a strong foundation," he said.

Suzlon Energy reported a consolidated net profit of 3.02 bln rupees for the June quarter on a consolidated revenue of 20.22 bln rupees. At 1302 IST, shares of Suzlon Energy traded 0.6% lower at 81.50 rupees on the National Stock Exchange. End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Tanima Banerjee

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2024. All rights reserved.