Sterling & Wilson Renewable Energy Ltd

With great pleasure, I address all of you today through our Annual Report FY 2024-25. We are proud to be one of India's leading pure-play, end-to-end renewable engineering, procurement, and construction (EPC) solutions companies, with a strong portfolio comprising solar, wind and BESS EPC projects, totalling 22.6 GWp of capacity and an operational O&M portfolio of 8.7 GWp. Your company has continued to grow organically in FY 2024-25 aided by favourable sectoral tailwinds, entry into new exciting segments, and strong execution. Our customers - both in India and across the World remain very confident of our project management capabilities and SWREL's growing portfolio is a testament to it.

The global renewable energy landscape continues to experience significant growth and transformation with a sharp fall in solar module costs, supportive government policies, and rising demand underpinning this expansion. India, too, remains steadfast in moving towards its ambitious clean energy transition goals and net-zero emissions, achieving the fastest pace of renewable capacity addition amongst all major economies. The energy sector is advancing towards a sustainable and secure future.

India remains on track to reach the 500 GW renewable energy target it set for itself by 2030 and is poised to become the third-largest renewable energy producer globally by setting the goal to achieve Net Zero carbon neutrality by 2070.

Evolving from a modest player to a key contributor to solar energy production and innovation, India plays a significant role in the global solar market. The National Solar Mission aims to achieve 280 GW solar power capacity by 2030. On the other hand, RE100 (Renewable Energy 100%), a global initiative led by the Climate Group and Carbon Disclosure Project, aims to unite businesses committed to 100% renewable electricity.

The government has taken numerous other initiatives to promote clean energy, boost renewable energy production, enhance energy access, and reduce the reliance on fossil fuels. PLI scheme, PM-KUSUM, PM-Surya Ghar, National Green Hydrogen Mission, and the changes made to the ALMM of solar photovoltaic modules are a few initiatives that demonstrate the nation's commitment towards a greener future.

Further, driven by the need for greater flexibility, reliability, cost-effectiveness in the energy landscape, and need for 24 hour round-the-clock (RTC) power, there

Evolving from a modest player to a key contributor to solar energy production and innovation, India plays a significant role in the global solar market. is increased adoption of technologies incorporating energy storage, hybrid systems, floating and solar, and a rise in battery storage integration. As we know, hybrid systems, combining various energy sources and storage technologies, offer a pathway to address the intermittency issues of renewable sources while enhancing grid stability and reducing reliance on fossil fuels.

There is a growing demand for end-to-end solar EPC players in India's renewable energy sector. Their ability to manage the entire solar project lifecycle - from design to commissioning - ensuring efficiency, firm execution timelines, cost efficiencies and timely project completion is highly sought after. India's solar EPC sector is experiencing significant growth, fuelled by technological innovations in design, mounting systems, robotics, and cleaning.

The sector is witnessing increased adoption of advanced monitoring systems, enhancing efficiency and reliability. Smart and remote operations & maintenance (O&M) ensure predictive maintenance, SCADA upgrades, and uptime guarantees. There is also a growing need for modularisation, pre-fabrication and digital engineering tools.

As is evident in any fast growing market, competition is inevitable, and it is important to be patient when the competitive intensity increases, and for the company to be mindful of potential risks. As an organisation, our focus and commitment is to grow profitably.

As the Indian solar energy market continues to grow rapidly, we are on a mission to provide reliable, affordable and sustainable solar power, strengthening our position as a leading homegrown EPC player in advancing sustainability goals in India's power sector.

We are a "preferred partner" for our valued customers in their renewable energy journey, working on large-scale solar projects and strengthening the O&M portfolio. We have been consistently winning repeat orders from large Private IPPs and PSU RE developers, which is a testimony of the relationships we have built.

What gives us a distinct market advantage is our experience of handling multiple utility scale projects in GW scale, the diversification in our vendor base, local sourcing, prioritising of the project pipeline and a well experienced team. Further, with our foray into new verticals such as hybrid projects comprising wind and solar, solar with storage, and pure-play battery energy

We leveraged our experience and further scaled up our business in India to leverage the growing business opportunities, further strengthening our position as one of the leading domestic renewable EPCs in the country. storage systems, we are confident of making remarkable progress on our journey forward. We are reputed for our scale of ambition, speed of execution, quality of operation, emphasis on safety, environmental compliance and a deep commitment to nation-building.

During the year under review, your company continued to build on the strong order inflow momentum from the domestic Indian market. We achieved a record order book or unexecuted order value of INR 9,096 crore, aided by new order inflows amounting to INR 7,051 crore. Total order inflow grew 17% compared to FY 2023-24.

Domestic order inflows touched INR 5,897 crore, growing 21% YoY.

We bagged 14 new projects in the Indian market totalling 4.4 GW. The company also won 2 international orders from the South African market.

Our full-year revenue stood at INR 6,302 crore, growing 108% YoY aided primarily by higher execution in the Indian EPC segment. The company achieved an EBITDA of INR 276 crore in FY 2024-25, compared to INR 54 crore in the previous year. Our bottomline has also turned profitable with a reported PAT of INR 86 crore.

Our balance sheet continues to remain strong and net debt has remained nearly flat at INR 178 crore despite a significant increase in the scale of execution this year as seen in the 2x jump in our top-line.

Our O&M business, which provides a steady annuity cash flow, grew 12.2% to INR 236 crore this year.

O&M Gross margins also improved to nearly 21% from 16% a year earlier.

As we commission more projects going forward, this business is expected to see a good growth in top-line and EBITDA.

The year was marked with progress and strategic achievements across our operations, fortifying our value proposition to customers. We optimally utilised our experience and further scaled up our business in India to leverage the growing business opportunities, further strengthening our position as one of the leading domestic renewable EPCs in the country.

The domestic market continues to witness strong growth momentum with a large project pipeline this year from both large PSUs and Private IPPs.

We also take pride in having won critical orders, with many of these order wins being from repeat clients, reaffirming our robust execution credentials and giving us revenue visibility. In the current year, out of the 14 major domestic orders received, 10 are from our existing clients, which shows the confidence customers have reposed in us to be a part of their growth in the domestic renewable market.

One of our key order wins in FY 2024-25 was the 2 x 250 MW AC standalone BESS plant at Rajasthan. This project is one of India's largest battery energy storage projects and one of the very few projects of gigawatt-hour scale in a single location globally. This order win depicts our in-house capabilities and knowledge for energy storage system engineering and execution and provides us a headstart in the fast-growing solar and storage market.

FY 2024-25 also marked our foray into the fast growing Hybrid projects segment, with our first Hybrid order in Rajasthan comprising Wind EPC of 69 MW and Solar EPC of 75 MW.

We continue to position ourselves as per our customer requirements and market trajectory, and these project wins are a reflection of the same. While we have already established a market-leading presence in India in solar and BESS, our entry into wind is expected to help us provide holistic EPC solutions for hybrid projects.

As a key player in India's solar EPC industry, we take pride in developing sustainability targets that will drive improvements across ESG metrics. This is done by offsetting carbon emissions through solar projects commissioned and through other internal initiatives on renewable energy usage. Our ESG roadmap encompasses sustainable procurement, waste management and energy-efficient operations.

We have also created a safe and encouraging environment for our employees to ensure their personal and professional development.

With a shared mission to fast-track clean energy for the planet, we look forward to continued collaboration to deliver the highest-performing, cost-efficient, and timely solutions to plant operator-owners across the globe. Given India's ambitious renewable energy targets, we are not just an energy producer but a provider of all energy solutions - floating solar, energy storage and utility-scale.

We continued to leverage strong relationships to increase our market share in rapidly growing Battery Storage, Green Hydrogen, and other Renewable Energy projects.

We expanded our offerings to include EPC solutions for hybrid energy power plants, and energy storage. Green energy solutions are a logical extension of our business into the rapidly growing renewables space, further helping us become a diversified company. We aim to utilise the growing opportunities to deepen our relationships with our customers and provide various solutions to meet the growing renewable energy requirements.

Furthermore, our engagement on the CSR front has led to numerous tangible outcomes, generating positive results for local communities. We continue to create social impact through key steps such as employment generation, community outreach, and skilling initiatives in project zones.

Guided by our governance framework, we ensure continuous stakeholder engagement, enhancing the trust of investors and customers in our delivery capabilities. We also ensure long-term success by promoting responsible practices and inclusive decision-making. Transparency in governance, risk management, and long-term value creation is a key tenet at SWREL, and we continue to collaborate with state nodal agencies, DISCOMs, and global partners.

We aim to maintain a strong order book by leveraging our global presence and local capabilities to secure prestigious projects globally and sustain a continued focus on select markets. We are working towards doing more business in margin-accretive regions, with a strategic focus on markets that have conducive solar power policies and high solar resources.

With module prices coming down and with solar becoming more dominant, the time is ripe for more projects to come on stream, aided by lower LCOEs, translating into more orders for EPC players.

The solar industry remains well poised to grow, with IPPs having huge plans for global capacity additions. India aims to become the fourth-largest renewable energy market by 2030, accounting for 9% of all global renewable energy use.

With the solar industry well poised to grow long-term as IPPs have huge plans for global capacity additions, we are fully geared to meet the growth opportunities ahead. Enthused by our strong bid pipeline of more than 25 GW for the coming fiscal, we are confident of continuing to further increase the domestic order momentum by ramping up execution capabilities, expanding in storage and hybrid projects, and further enhancing our presence in the international markets. With strategic investments in digital tools, automation, and capacity-building, we remain well-poised to meet the growth opportunities.

We are committed to being an EPC player and a long-term partner in energy transition, supporting India's net-zero ambitions and our evolving strategic role. We continue targeting the growing EPC markets, focussing on grabbing a large share of EPC additions. With the announcement of the National Hydrogen Mission, we are expanding into new businesses and working on round-the- clock RE projects with battery storage.

In addition, we are enhancing our focus on solar PV and BESS projects in the Europe, and Africa.

Further, we endeavour to emphasise growing our O&M portfolio and tapping third-party O&M in international markets through organic and inorganic routes.

As one of the leading international EPC turnkey solution providers with solid fundamentals and a forward-looking focus, we are unlocking the potential of green energy in various parts of the world, customising solutions according to geography-specific needs.

Looking ahead, we are invigorated by the potential for ongoing growth and innovation. We owe a profound debt of gratitude to all our stakeholders, whose unwavering commitment and support have been crucial.

Together, we have reached significant milestones, and together, we will surmount any challenges we may face. Your faith in our vision drives us, steering us through challenges and toward new opportunities.

We thank all our employees for their commitment and engagement towards building a strong, agile and responsible organisation. We also look forward to sharing more milestones with you in our journey in the coming years.

We seek your continued partnership and encouragement.