ReNew Energy Global Plc Q4 FY2026 earnings call

• Sector Context & Market Position

  • India's focus on domestic energy security amid Middle East geopolitical tensions has accelerated renewable energy adoption; renewables accounted for 90% of India's 51 GW new capacity additions in fiscal 2026, with solar as the dominant growth driver and growing demand for battery storage for non-solar hour power needs.
  • Renew is positioned across three diversified, resilient segments (utility-scale, CNI, manufacturing) to capture sector growth, with a total development pipeline exceeding 26 GW (2.6x larger than at its August 2021 listing).

• Execution & Portfolio Growth

  • Commissioned a record 2.4 GW of renewable capacity in fiscal 2026 (1.7 GW solar, 600 MW wind), signed 2.5 GW of new PPAs during the year, and locked in 50% of FY27 module supply, 100% of battery and wind turbine pricing, and secured most required land for next year's projects, giving strong execution visibility.
  • The company is actively shifting its portfolio toward solar and battery storage (reducing wind exposure) to improve execution timelines, increase cash flow predictability, and lower capital intensity; wind projects will still be pursued for high-IRR CNI opportunities.
  • The CNI segment (one of India's largest at 2.7 GW total capacity) raised $95 million for an 11.3% stake from a Leapfrog-led consortium to fund growth, and benefits from low renewable penetration among CNI customers (who consume 50% of India's electricity) and fast-growing demand from data centers and technology firms.

• Solar Manufacturing Development

  • Renew currently operates one of India's largest integrated solar manufacturing facilities, which provided secure supply amid import restrictions and became a profitable, self-funded growth engine. The company raised $100 million from BII for a ~6% stake in the business.
  • A 4 GW Topcon cell expansion is on track to start production in the second half of fiscal 2027, aligned with the ALMM2 mandate requiring domestic cell sourcing starting June 2026. A new 6.5 GW ingot and wafer facility has been announced to further backward integrate (aligned with the upcoming ALMM3 mandate for domestic ingot/wafer sourcing starting June 2028) and protect upstream margins; the expansion will be funded via a mix of internal manufacturing accruals and external fundraising, with no additional equity required from the parent company.

• Financial Performance & Balance Sheet

  • Full year fiscal 2026 delivered adjusted EBITDA of INR 98.5 billion (25% YoY growth, above the top end of prior guidance), and a record profit after tax of INR 10.4 billion (2.3x YoY growth, third consecutive year of profitability).
  • The company completed $375 million in capital recycling and fundraising during the year (including $195 million from minority stakes in mature businesses and $180 million from 600 MW of project asset sales), and used proceeds to repay debt, reducing net debt to EBITDA by 1.1x YoY to 61.5% interest expense to adjusted EBITDA (down from 66% in fiscal 2025).
  • Received a favorable Supreme Court ruling for ~50% of outstanding overdue Andhra Pradesh receivables, which represented over 50% of total overdue receivables, and has started receiving initial payments; the company targets reducing DSO to under 50 days by next year.
  • ~90% of foreign currency principal and 100% of foreign currency interest is hedged, limiting the impact of 10% rupee depreciation in fiscal 2026 to just a 30 basis point increase in interest costs.

• ESG Accomplishments

  • Received top global ESG ratings, including S&P Global CSA Yearbook top 10% globally (score of 84), CDP A rating for the second consecutive year, MSCI AAA (highest rated energy utility in India, top 19.5% of global utilities), and the CII ITC Sustainability Outstanding Accomplishment Award.
  • On track to meet SBTI-validated net zero targets, CSR initiatives have impacted over 1.7 million lives, and the company is progressing toward its 2030 target of 30% women in the workforce (currently at 17.6%).

For full fiscal 2026:

1. Core renewable energy business (utility-scale + CNI): Adjusted EBITDA of INR 83.7 billion, contributing ~85% of consolidated adjusted EBITDA. The operating portfolio grew 25% YoY to 12.8 GW adjusted for asset sales, with a total committed portfolio of 20.2 GW, including 2.7 GW of CNI (grew 7x in 5 years, 50% of CNI capacity contracted to large technology/hyperscaler customers).
2. Solar manufacturing segment: Standalone adjusted EBITDA of INR 19 billion, with a consolidated contribution of INR 14.8 billion, representing 15% of full year consolidated adjusted EBITDA. In Q4 2026, the manufacturing segment contributed INR 4 billion in adjusted EBITDA, compared to INR 3.6 billion in Q4 2025.

• For full fiscal 2027, management guides consolidated adjusted EBITDA to a range of INR 103 to 109 billion, representing 17% growth from the prior year's guidance range, with contributions from both core renewable and manufacturing segments.
• Solar manufacturing adjusted EBITDA is guided to INR 10 to 12 billion for fiscal 2027; margins are expected to moderate slightly this year, but the 4 GW cell expansion is projected to contribute meaningfully starting fiscal 2028, and the 6.5 GW ingot/wafer facility will contribute starting fiscal 2029.
• Guides INR 1.2 billion in income from asset recycling, 1.6 GW to 2.4 GW of new capacity construction, and cash flow to equity of INR 18 to 22 billion for fiscal 2027.
• The long-term target for consolidated net debt to EBITDA remains ~5.5x for the fully constructed portfolio.

• Grid transmission expansion has not kept pace with renewable energy installations, leading to project curtailment (particularly in Rajasthan); while impact declined in Q4 fiscal 2026, some curtailment impact is expected in the first half of fiscal 2027, which may also constrain national solar capacity growth at the margin.
• Proposed DSM regulations from the CERC could create a potential INR 0.5 billion negative impact for fiscal 2027 if implemented as currently written; however management expects revisions and relaxations to the current proposal, so the impact is unlikely to materialize as estimated.
• The company has $1 billion USD of debt maturing in the first half of 2027; while it has already secured $400 million in refinancing commitments, full refinancing remains outstanding and subject to market conditions.
• Geopolitical volatility and global macroeconomic conditions create uncertainty for funding costs and project execution timelines.

Q: When will the new 6.5 GW ingot/wafer facility start contributing earnings, and is any contribution included in FY27 guidance? Will the facility produce for third-party sales? / A: The 4 GW Topcon cell facility will start production at the end of FY27, so no contribution is included in FY27 guidance as it will only be in trial production initially. The 6.5 GW ingot/wafer facility will not be commissioned until June 2028, so it will not contribute in FY27 or even full FY28. Management did not explicitly comment on third-party sales in this exchange.

Q: If the currently stayed CERC DSM regulations go into effect as proposed, what impact would that have on Renew given its large wind portfolio? / A: Management expects the current proposed guidelines will be revised and relaxed, so the current draft is unlikely to remain in place. If implemented as-is, the impact would be ~INR 0.5 billion for FY27; no estimates have been calculated for subsequent years, as the regulations are expected to change.

Q: Are you seeing emerging opportunities in green hydrogen/associated products like green methanol, and do you expect growth in this segment? / A: Management confirms new opportunities are emerging domestically, including an upcoming 500 kTPA green methanol tender and renewed activity for fertilizer and refinery projects. Overseas demand is also growing in the Far East and expected to pick up in Europe soon. Management expects green hydrogen will become a material growth opportunity in the medium term.

Q: What is the total capex for the 6.5 GW ingot/wafer facility, and how will it be funded? / A: Total capex for the facility (excluding a captive power plant) is approximately INR 42 billion. Around 50-60% of the capex will be funded via project-level debt, with the balance covered by internal cash accruals from the existing manufacturing business and a planned external fundraising. No additional equity will be required from the Renew parent company.