Azure Power Global Limited

For Q3 FY22, revenue was $60.2 million, or $58.8 million excluding rooftop, versus guidance of $55.3 million to $58 million. EBITDA was $50 million after adjusting for first-half compensation expense reversal, and EBITDA from operating assets increased about 27% year over year while cash flow to equity from operating assets rose about 58% year over year. As of December 31, 2021, operating capacity was 2,523 MW AC, 37% higher year over year, DSO was 113 days versus 116 days at March 31, 2021, cash and cash equivalents were about $150 million, net debt was approximately $1.48 billion, and net debt-to-EBITDA for operating assets was 6.1x. For Q4 FY22, revenue guidance was INR5.21 billion to INR5.2 billion, or $68 million to $70 million, and PLF guidance was 22.5% to 23.5%. For FY22, commissioned MW guidance was narrowed to 2,855 MW to 2,955 MW. For FY23, management guided revenue of INR22 billion to INR23 billion, or $295.7 million to $309.2 million, and said it did not expect incremental AC megawatts commissioned by March 31, 2023.

Ranjit Gupta framed the quarter around execution, growth visibility, and improving economics. He emphasized the signing of 2,333 MW of PPAs, the rights offering, refinancing progress, and the company’s expansion into energy transition, storage, and green hydrogen. His tone was constructive and confident, but he also acknowledged supply-related challenges at Rajasthan 9 and said commissioning timing for future projects will depend on construction readiness and module costs.

Pawan Kumar Agrawal highlighted the beat versus revenue guidance and the operational leverage from higher capacity. He cited EBITDA of $50 million, G&A up 10%, average interest rates falling from 9.2% to 8.8% and then 8.5% post-quarter, and a refinancing example at Rajasthan 6 at 7.2% fixed for 42 months. He also noted 113-day DSO, about $150 million in cash, net debt of about $1.48 billion, and a 6.1x net debt-to-EBITDA ratio for operating assets, while explaining that much of the FY23 capital spending is an allocation for projects to be built later rather than immediate commissioning.

Analysts focused on the timing of remaining SECI PPAs, whether projects could be brought online earlier, the impact of module supply constraints and ALMM/BCD, the logic behind FY23 CapEx despite limited commissioning, and Karnataka receivables. Management said a small 30 MW PPA should be signed within a week or two, roughly 1,000 MW more should follow within the next quarter, and the current plan is to commission the 4 GW SECI projects on schedule rather than early. On modules, management said the near-term period could be challenging, but they are comfortable because current construction needs are already covered and they expect availability to improve next year. On Karnataka, they said GESCOM and CESCOM are paying current bills, while HESCOM remains in dispute and they are cautiously optimistic about recovering about $10 million to $12 million this fiscal.