Inox Green Energy Services LtdQ3 FY23
Inox Green Energy Services Ltd Q3 FY23 Earnings Call Analysis
Revenue, margin, capex, fundraise and order book outlook from management commentary.
Price: ₹198P/E: 89.0Market Cap: ₹7.1K CrSector: Commercial Services & Supplies
Management growth scorecard
Revenue
Category 2
Margin
Category 3
Fundraise
No
Order
Yes
Capex
Yes
2 of 5 growth signals are positive.
Full analysisRevenue guidance
Category 2- →INOX Green aims to nearly double its O&M portfolio from 3.2 GW to 6 GW by FY26 through organic and inorganic growth.
- →Parent company Inox Wind targets executing a minimum of 500 MW of orders annually starting FY24, which will integrate into INOX Green's portfolio.
- →INOX Green expects organic growth of 1,500 MW between FY24 and FY26.
- →There is a 10 GW market opportunity from unorganized, fragmented wind fleet O&M players for inorganic acquisitions.
- →The subsidiary I-Fox recently secured a 51 MW O&M contract with NLC India, indicating order inflows.
- →Management expects steady revenue additions, with around INR 80 crores incremental revenue annually per 1,000 MW added.
- →The business enjoys stable, annuity-like revenues with built-in annual escalation and strong stickiness.
- →Overall outlook is positive, anticipating growth driven by sector tailwinds and strategic acquisitions.
Margin guidance
Category 3- →INOX Green aims to nearly double its O&M portfolio from 3.2 GW to 6 GW by FY26 through organic and inorganic growth, adding approximately 1,000 MW annually.
- →Organic growth is expected to contribute around 500 MW per year; inorganic additions come from acquisition opportunities in the fragmented wind O&M market (~10 GW opportunity).
- →EBITDA margins are stable, historically over 50%, and expected to continue.
- →EBITDA run rate is improving; H1 FY24 EBITDA was INR 62 crores, annualized to about INR 125 crores.
- →ROCE and ROE are projected around 18-20%, with improvements expected as depreciation reduces the gross block.
- →Finance costs will reduce significantly post debt retirement, virtually eliminating interest expenses by next fiscal year.
- →Revenue per MW is estimated between INR 8-10 lakhs, with blended EBIT margins of about 50%.
- →The company expects stable, annuity-like cash flows with long-term contracts (20-25 years), providing predictable profit growth.
3 more insights locked — sign up free to unlock
Fundraise plans
No- →No specific mention of any current or planned fundraising through debt or equity in the transcript.
- →Management indicated that Inox Green is expecting to become net debt-free by March following the Nani Virani divestment.
- →They expect to have very minimal finance costs going forward, mainly routine banking charges (INR 1-3 crores), and do not intend to have significant finance costs next year.
- →The company has no plans for further capital expenditure (capex), which likely reduces the need for raising additional funds.
- →Growth is expected to come through organic and inorganic means without reliance on new debt or equity fundraising.
Order book
Yes- →Inox Wind's current order book is close to 1,300 MW.
- →The company plans to add a minimum of 500 MW of orders annually starting FY24.
- →INOX Green is committed to doubling its O&M portfolio from 3.2 GW to 6 GW by FY26 through organic and inorganic means.
- →There is a substantial market opportunity with around 10 GW from unorganized and fragmented wind fleet O&M players, particularly distressed OEM assets.
- →INOX Green and its subsidiary I-Fox are actively engaged in discussions with third-party wind O&M service providers for portfolio acquisitions.
- →The subsidiary I-Fox won a 51 MW O&M order from NLC India.
- →Management envisions adding about 1,000 MW annually, split roughly 50-50 between organic growth and inorganic acquisitions.
Capex plans
Yes- →INOX Green Energy Services Limited currently has **zero capex plans**; the company is not undertaking any new capital expenditure.
- →The company's **net block reduces by depreciation (~INR 50 crores per year)**, and it anticipates eliminating most of its property and plant depreciation by FY26.
- →Future ROCE and ROE are expected to improve as depreciation lowers the net block.
- →Growth is planned through **organic and inorganic portfolio additions**, not capital investments.
- →Inorganic growth opportunities include acquisitions in the **unorganized and fragmented wind O&M sector**, targeting around 10 GW of assets from distressed OEMs.
- →The company recently signed a term sheet to **divest 100% stake in 50 MW Nani Virani SPV** for ~INR 290 crores to become net debt free.
- →The focus is on **enhancing operational efficiency and digital transformation** rather than capital investments.
How does Inox Green Energy Services Ltd rank vs peers in Commercial Services & Supplies?
Pro feature1Inox Green Energy Services Ltd
Rev 2Mar 3
See full Commercial Services & Supplies sector rankings
Want more stocks like Inox Green Energy Services Ltd?
Build an AI portfolio filtered by sector, market cap, and growth rank. Takes 2 minutes.
Build my portfolio