RNWWW — ReNew Energy Global plc

Summary of ReNew's Q3 FY 2026 Earnings Call

1. Key Financial Results and Metrics

• Adjusted EBITDA: Increased by 31% to INR 74.8 billion for the first nine months of FY 2026.
• Profit After Tax: Over sixfold increase compared to the previous year.
• Revenue Growth: 48% increase driven by higher megawatt capacity and manufacturing contributions.
• Leverage: Reduced to approximately 6.7x debt-to-EBITDA, with a target of under 5.5x for the fully constructed portfolio.
• Bond Offering: Successfully raised $600 million at a reduced interest rate of 6.5%, saving $9 million annually in interest expenses.

2. Strategic Updates and Business Highlights

• Operating Capacity: Increased from 10.7 GW to 11.8 GW, with a 19% growth in the overall portfolio to 19.2 GW, including 1.5 GW of battery energy storage systems (BESS).
• Portfolio Optimization: Shifted focus from wind to solar and BESS to reduce execution risk and enhance cash flow predictability.
• Manufacturing Performance: Contributed INR 10.8 billion to adjusted EBITDA; ongoing expansion with a new 4 GW cell facility.
• C&I Business Growth: Expanded portfolio by 30% with contracts from major tech companies, comprising 50% of the customer base.

3. Forward Guidance and Outlook

• Adjusted EBITDA Guidance: Increased to INR 90 billion to INR 93 billion for FY 2026.
• Construction Guidance: Narrowed range to 1.8 to 2.4 GW for the fiscal year ending March 31, 2026.
• Manufacturing Contribution: Expected to contribute INR 11 billion to INR 13 billion to adjusted EBITDA.

4. Challenges and Points of Concern

• Transmission and Curtailment Issues: Ongoing challenges with transmission project delays and curtailment, which are being addressed by government discussions but remain a concern for the industry.
• Market Volatility: Fluctuations in wind performance and execution difficulties have historically impacted returns, leading to a strategic pivot towards solar and BESS.
• Leverage Management: While leverage is decreasing, the company aims to further reduce it to enhance shareholder returns, indicating a focus on financial discipline.

5. Notable Q&A Insights

• Strategic Shift to Solar and BESS: The decision to reduce wind capacity was influenced by lower costs and improved predictability of solar and BESS compared to wind.
• Manufacturing Plans: No immediate plans to manufacture BESS, primarily due to cost advantages of imports and rapid technological changes in battery technology.
• Compensation for Curtailment: Projects with Guaranteed Network Access (GNA) receive compensation for curtailment, while those with Temporary GNA (T-GNA) do not, highlighting a financial risk management aspect.
• Long-term Leverage Goals: The company aims to reduce leverage to 5.5x by 2028-2030, emphasizing the importance of freeing up cash flow for shareholders.

Overall, ReNew demonstrated strong financial performance and strategic pivots towards more stable energy sources, while also addressing industry challenges and maintaining a focus on sustainability and shareholder value.