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    Inox Wind

    INOXWINDStrong
    Capital Goods·1 Sept 2025
    Management Summary

    Inox Wind delivered a quarter characterized by massive bottom-line expansion despite modest volume growth, signaling a successful strategic shift toward high-margin execution and 'complete set' deliveries. The company has fortified its balance sheet through a successful rights issue and the elimination of NCRPS post-merger. Management is extremely bullish, backed by a 3.1 GW order book and significant regulatory tailwinds including ALMM for wind and new CERC hybridization norms.

    Highlights

    8

    • Revenue reached ₹863 crores, a 32% YoY increase despite Q1 being a seasonally weak quarter.

    • PAT surged 134% YoY to ₹97 crores, while Cash Profit grew 168% YoY to ₹186 crores.

    • EBITDA stood at ₹220 crores (39% YoY growth) with a reported margin of 25.5% for the quarter.

    • Execution volume was 146 MW, a modest 4% YoY increase as the company prioritized complete sets and profitability over volume.

    • Order book remains robust at 3.1 GW, with management stating they are effectively 'sold out' for the next two years.

    • Full-year FY26 execution guidance maintained at 1.2 GW, with FY27 guidance set at 2.0 GW.

    • EBITDA margin guidance for FY26 raised to 18-19% from the previous 17-18%.

    • Inox Green reported a 79% YoY income growth and is targeting an O&M portfolio expansion from 5 GW to 17 GW within two years.

    What Changed1

    vs Q2 FY26

    Tone shiftGood → Strong

    Key financials

    Single quarter

    05 metrics
    1. 01Revenue₹863 Cr+32%YoY
    2. 02EBITDA₹220 Cr+39%YoY
    3. 03PAT₹97 Cr+134%YoY
    4. 04Cash Profit₹186 Cr+1.7%YoY
    5. 05MW Executed146 MW+4%YoY

    Segment breakdown

    Inox Green (O&M)
    ₹98 Cr Total Income₹48 Cr EBITDA49% EBITDA Margin₹44 Cr Cash PAT
    List

    Guidance & targets

    5
    CategoryTargetPriority
    Volume
    Annual Execution
    1.2 GW
    		High
    Volume
    Annual Execution
    2.0 GW
    		Medium
    Margin
    EBITDA Margin
    18-19%
    		High
    Capacity
    O&M Portfolio Size
    17 GW
    		High
    Other
    Net Working Capital Days
    120 days
    		Medium

    Risks & concerns

    5
    RiskSeverity

    Seasonality of Execution

    H1 typically accounts for only 30-35% of annual execution due to monsoon impacts in key states like Gujarat. — Management acknowledged

    medium

    Working Capital Intensity

    Receivables and inventory days remain high; management targets maintaining 120 days net working capital. — Analyst acknowledged

    medium

    Execution Backlog

    Q4 FY25 had a mismatch in blades and towers (incomplete sets) which had to be cleared in Q1 FY26. — Management acknowledged

    low

    Areas of Evasion(2)

    • Specific mix of solar vs wind in the 17 GW O&M target.
    • Specific realization per megawatt mathematics for future years.

    Q&A highlights

    3

    “What we are increasingly focusing on is complete sets, more execution on the ground and working capital efficiency. And that is what is driving the numbers which you talk about to be only 4%, even though EBITDA scaled up much higher.”

    Explains that revenue recognition is now tied to higher-value 'complete sets' rather than just shipping individual turbine components, improving margins.

    asked by Nidhi Shah, ICICI Securities

    2 min read5 chapters

    Detailed Narrative

    01

    Profitability Decouples from Volume Growth

    Inox Wind's Q1 FY26 results showcased a significant divergence between operational volume and financial performance. While MW execution grew by only 4% YoY to 146 MW, PAT surged by 134% to ₹97 crores. Management attributed this to a strategic focus on 'complete sets' and clearing backlogs of incomplete turbines from previous quarters. This shift ensured that revenue recognition was tied to higher-margin components and full assembly, leading to a reported EBITDA margin of 25.5% for the quarter, well above their full-year guidance.

    02

    Aggressive Expansion of Inox Green O&M

    The O&M arm, Inox Green, is positioned as a massive annuity cash flow generator. Management outlined a path to grow the portfolio from the current 5 GW to 17 GW within the next two years. This growth will be fueled by organic additions from Inox Wind's 3.1 GW order book, inorganic acquisitions (including a recent investment in a fund controlling 2 GW of assets), and a strategic shift by large IPPs to outsource O&M services. The segment maintains high EBITDA margins of approximately 49%.

    03

    Fortified Balance Sheet and Corporate Actions

    The company has successfully executed several corporate actions to simplify its structure and reduce debt. The merger of IWEL into IWL is complete, and a rights issue raised ₹560 crores from promoters alone, which was used to pare down debt. The company is now in a net cash position. Additionally, the demerger of the substation business into Inox Renewable Solutions (IRSL) is underway, which is expected to eliminate ₹50-55 crores of annual depreciation and improve ROE/ROCE once approved by NCLT.

    04

    Regulatory Tailwinds as Growth Catalysts

    Management highlighted two major regulatory shifts: the ALMM (Approved List of Models and Manufacturers) for wind and the CERC notification on hybridization. ALMM is expected to curb Chinese imports and benefit domestic manufacturers like Inox Wind. The CERC notification allows hybridization of existing transmission infrastructure for projects over 50 MW, which management described as 'game-changing,' as it allows them to utilize existing evacuation infrastructure for multiple times the current capacity by adding solar to wind sites.

    05

    Future Roadmap: 2 GW and Beyond

    Looking ahead, Inox Wind is ramping up its manufacturing capacity to meet a 2 GW annual execution target for FY27. This includes a new nacelle plant in Ahmedabad and a planned blade manufacturing facility in South India to improve logistics and access to southern wind-rich states. With a 3.1 GW firm order book and a multi-gigawatt pipeline, the company claims to be 'sold out' for the next two years, focusing now on execution efficiency and maintaining its newly raised 18-19% EBITDA margin guidance.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.