Key rating drivers include AGEN being India's largest renewables developer with good operating parameters of operating assets and healthy free cash flows in equity as well as promoter infusion covering equity commitments.
Continued strong operating asset performance The upgrade factors include "strong execution scale-up", with annual capacity additions expected to reach 4GW-5GW annually in the medium term from 2.5-3.5GW previously.
Other factors for the upgrade include healthy counterparty diversification and deleveraging in receivables, leading to an increase in (cash flow from operations-interest)/EBITDA conversion compared to historical levels.
According to the rating agency, the upgrade also reflects AGEL's change policy with respect to the holding company's leverage, as the company has now earmarked funds for the repayment of $750 million of hold-CO bonds.
“Furthermore, the upgrade factors include the creation of a platform with Total Energy SE within AGEN, allowing partial asset monetization while retaining consolidation benefits, equity investment by promoters through warrants, of which 25 per cent Already achieved, and according to analysts, the company's continued ability to tie up debt and raise equity to fully finance the under-construction portfolio.Earlier this month, AGEL reported 30 per cent EBITDA growth to Rs 7,222 crore in FY24 as the renewable energy (RE) major revised its target for 2030 to 5 gigawatt (GW) from 45 GW.
The strong growth in revenue, EBITDA and cash profit was driven by capacity addition of over 2.8 GW over the last year, which is 15 per cent of the country's total renewable energy capacity addition.
According to analysts, the upgrade in ratings also reflects Ind-Ra's expectation of favorable operating under-construction book ratio, given the operational capacity of about 10.9 GW and increase in annual capacity addition target by 5 GW and "amortization structure". Is. Bulleted structures of the loan as before, which ensure amortization of the loan, leading to 1 per cent tail life for the projects, thereby reducing refinancing and Tai risks.
The note said the above factors have combined to contribute to a reduction in leverage to a reasonable level of 5.5-6.5 times from historically high levels.
Continued strong operating asset performance The upgrade factors include "strong execution scale-up", with annual capacity additions expected to reach 4GW-5GW annually in the medium term from 2.5-3.5GW previously.
Other factors for the upgrade include healthy counterparty diversification and deleveraging in receivables, leading to an increase in (cash flow from operations-interest)/EBITDA conversion compared to historical levels.
According to the rating agency, the upgrade also reflects AGEL's change policy with respect to the holding company's leverage, as the company has now earmarked funds for the repayment of $750 million of hold-CO bonds.
“Furthermore, the upgrade factors include the creation of a platform with Total Energy SE within AGEN, allowing partial asset monetization while retaining consolidation benefits, equity investment by promoters through warrants, of which 25 per cent Already achieved, and according to analysts, the company's continued ability to tie up debt and raise equity to fully finance the under-construction portfolio.Earlier this month, AGEL reported 30 per cent EBITDA growth to Rs 7,222 crore in FY24 as the renewable energy (RE) major revised its target for 2030 to 5 gigawatt (GW) from 45 GW.
The strong growth in revenue, EBITDA and cash profit was driven by capacity addition of over 2.8 GW over the last year, which is 15 per cent of the country's total renewable energy capacity addition.
According to analysts, the upgrade in ratings also reflects Ind-Ra's expectation of favorable operating under-construction book ratio, given the operational capacity of about 10.9 GW and increase in annual capacity addition target by 5 GW and "amortization structure". Is. Bulleted structures of the loan as before, which ensure amortization of the loan, leading to 1 per cent tail life for the projects, thereby reducing refinancing and Tai risks.
The note said the above factors have combined to contribute to a reduction in leverage to a reasonable level of 5.5-6.5 times from historically high levels.
