Inox Green Energy Services Limited
Financial Results Review – Quarter ended 30 June 2025
Date of Board Meeting: 14 August 2025

1. Auditor’s Note

• Type: Limited Review Report by M/s Dewan P.N. Chopra & Co., Chartered Accountants.
• Conclusion:
  • No qualifications or adverse remarks.
  • The review did not identify any material misstatements.
• Emphasis of Matter:
  • Investments in 6 SPVs with pending regulatory and litigation matters (Note 3/4).
  • Revenue recognition policy for O&M services on a straight-line basis and related receivables of Rs. 11,878 Lakh (Note 5).
  • No material adjustments expected for machine availability delays in O&M contracts (Note 6).
• Other Matters:
  • Party balances subject to confirmation/reconciliation; management expects no material impact.
  • Consolidated results include one subsidiary with immaterial financials.
• Overall: Standard review with emphasis on specific notes; no modifications to audit conclusion.

2. Financial Performance

3. Detailed Notes / Management Commentary

• Accounting Policies & Revenue Recognition:

  • Revenue from O&M services recognized on a straight-line basis over contract period.
  • Rs. 11,878 Lakh of O&M services rendered but yet to be billed; management expects no material adjustments or liabilities related to these.
  • No material adjustments expected for machine availability delays in O&M contracts.

• Investments in SPVs:

  • Company invested in 6 SPVs via inter-corporate deposits and bank guarantees of Rs. 5,578 Lakh for wind farm projects under SECI.
  • Project completion dates expired as of 30 June 2024; extension applications rejected; bank guarantees invoked.
  • Appeals filed with regulatory authorities (CERC); outcome uncertain but management expects to succeed with no material impact.
  • If funds unrecoverable, Inox Wind Limited will bear costs as approved in AGM.
  • Investment in 3 SPVs sold during previous year.

• Litigation:

  • Pending litigation with courts/appellate authorities; management believes no material impact beyond provisions already made.

• Related Party Transactions:

  • Related party transactions of Rs. 220 Lakh during Q1 FY26 accounted as purchase of stock-in-trade.

• Corporate Actions:

  • Demerger of Power Evacuation business approved by Board (Nov 2024), subject to approvals and NCLT sanction.
  • Draft scheme filed with stock exchanges with no adverse observations.

• Equity Issuance:

  • Previous year: Issued 2.89 crore equity shares and 4.48 crore convertible warrants at Rs. 138 and Rs. 1451 per share/warrant respectively (including premium).
  • Warrants convertible into equity within 18 months; 27.58 lakh warrants converted during previous year.

4. Segment Information

• Standalone: Single business segment – O&M services for Wind Turbine Generators (WTGs) and Common Infrastructure Facilities.
• Geography: Operations only in India; single geographical segment.
• Consolidated: Multiple segments reported:
  • Operation & Maintenance (O&M)
  • Power Generation
  • Trading Income
• Segment-wise revenue and results disclosed in consolidated results (details not fully provided in excerpt).

5. Capex, Projects, and Corporate Activity

• Capital Expenditure: No explicit capex figures disclosed for the quarter or year.
• Projects:
  • Investment in 6 SPVs for wind farm projects under SECI; projects delayed with regulatory issues.
• Impairments / Provisions:
  • Provisions made for probable liabilities related to litigation; no material adjustments expected.
• Acquisitions / Disposals:
  • Sale of shareholding in 3 SPVs during previous year.
• Restructuring:
  • Demerger of Power Evacuation business approved, pending regulatory approvals.

6. Standalone vs Consolidated

• Both Standalone and Consolidated unaudited financial results for Q1 FY26 (April-June 2025) reviewed and approved.
• Consolidated results include multiple subsidiaries (17 listed), with one subsidiary’s financials considered immaterial.
• Standalone results focus on O&M services; consolidated results include power generation and trading segments.

Summary for Investment Analysis Team

Recommendation: Monitor developments on SPV project appeals and demerger approvals. Watch quarterly revenue and profitability trends, especially in consolidated results reflecting broader business segments.