Thank you for standing by, and welcome to the ReNew Power 2Q 2022 earnings call. All participants will be in listen-only mode. There will be a presentation followed by question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I now would like to turn the conference over to your host today, Nathan Judge. Please go ahead.
Thank you, Keith, and good morning, everyone, and thank you for joining us. Last night, ReNew Energy issued a press release announcing results for the first half and second quarter of fiscal 2022 ended September 30, 2021. A copy of the press release and the presentation are available on the investor section of ReNew Power's website at renewpower.in. With me today are Sumant Sinha, Founder, Chairman, and CEO, and Kailash Vaswani or Muthu, our CFO. Sumant will start the call by going through an overview of the company and recent key highlights. Muthu will then provide an update on the quarter, and then we'll wrap up the call with Sumant reiterating our weather adjusted FY 2022 EBITDA forecast of $810 million and our megawatt operating guidance for this year. After this, we will open the call up for questions.
Please note our Safe Harbor statements are contained within our press release, presentation materials and available on our website. These statements are important and integral to all our remarks. There are risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements. We encourage you to review the press release we furnish in our Form 6-K and presentation on our website for a more complete description. Also contained in our press release, presentation materials and annual report are certain non-IFRS measures that we reconcile to the most comparable IFRS measures, and these reconciliations are also available on our website in the presentation and in the press release and annual report. It is now my pleasure to hand it over to Sumant Sinha.
Yeah, thank you for that, Nathan. Good morning to everybody. We are extremely pleased to host our very first earnings call as a publicly traded company. We believe that RNW is one of the most compelling investment opportunities in the renewable energy sector today. Some of you may be new to our exciting story, and we will provide a brief overview of our company and near-term strategy, followed by an update on recent developments, as well as a deeper dive into our first half and second quarter fiscal 2022 financial results. If we turn to the presentation, looking at our portfolio on page five, ReNew is one of the leading renewable energy companies in India and also one of the largest renewable energy companies globally.
Our scale and our vertical integration differentiates us in multiple ways, including being more efficient at lower cost, having greater access to cheaper capital, and investing for the future to retain our competitive edge in what is still a young and rapidly evolving market, while also maintaining industry-leading EBITDA margins. We now have a long track record of execution, as well as delivering superior growth and returns over a long period of time. When we first started with our 25 MW project about 10 years ago, there were many companies that were interested in getting into the Indian renewable sector. Over time, we have been able to consistently grow faster than the industry while remaining disciplined with our capital allocation. Much of this success lies in our corporate culture of thinking ahead, making judicious investments for sustaining our competitive advantages ahead of time.
I must stress this because this is in fact a very important ingredient of our success as a company. We have renewable assets spread across the country, which provides diversification and operating expertise in many states of India. By being local, we are able to capture synergies from acquisitions, which most of our foreign competitors cannot avail. About two-thirds of our portfolio is operating and much of the assets that are in development already have PPAs. I must add that our portfolio is well balanced between solar and wind, and this expertise is critical as we look to the future, where we will see more and more bids happening which require a combination of both wind and solar. On page six, we remain on track to deliver our previously announced guidance.
As of today, we have 7 GW operating, up from 6.3 GW that we had operating on September 30, 2021. We have about another 400 MW scheduled to be commissioned in the next couple of weeks. This, by the way, also makes us the first company in India to now get to 7 GW of commissioned renewable energy capacity. As a result, we continue to expect our FY 2022 adjusted EBITDA, excluding the impact of weather, which was approximately $40 million in the first half of this fiscal year so far, to be approximately $810 million, and we will have approximately 8.2 GW operational by the end of this fiscal year.
We want to therefore point out that 95% of our expected FY 2022 EBITDA is coming from operating off completed capacity. We expect to deliver EBITDA of over $1.1 billion annually from our 10.3 GW portfolio, which is nearly double our EBITDA that we reported last year. We have confidence in achieving this growth as about $1 billion in EBITDA should be generated from commissioned projects or projects which have signed PPAs and are in the construction phase already. Moving on in the presentation to page seven. We believe that we have a total addressable market of around $200 billion-$270 billion for generation assets in India. The majority of this market is in the bid market.
The Indian Prime Minister at the recent COP26 summit in Glasgow outlined a five-fold strategy which included getting India's non-fossil energy capacity to 500 GW by 2030. Two, 50% of India's energy requirements to be met by renewable energy by 2030. Three, India to reduce its projected carbon emissions by 1 billion tons by 2030. Four, Carbon intensity will fall by 45% by 2030, and India would achieve net zero by 2070. These are very fundamental announcements that I think really position India very strongly on the path towards the energy transition. Today, there are about 8 GW-10 GW of auctions scheduled over the next quarter, and there are numerous more intelligent energy solution auctions in the works. The M&A opportunity is also very large, and we see around 30 GW-50 GW of M&A opportunities in the coming time.
Currently there is about 6-8 GW that is up for sale at this point. We ourselves have a significant amount of experience with M&A, having acquired almost 2 GW in the last five years. A market we're also very excited about is the corporate PPA market. To be clear, this is not rooftop projects, and we are supplying to customers from utility scale projects. We see a corporate PPA market in India of at least 25 GW over the next few years. We also continue to believe that we will be able to deliver our aspirational goal of 18 GW operational by the end of FY 2025, and we are in fact fully funded at this point for this target to be achieved. Turning to page eight.
We reiterate our commitment to our shareholders that we will be diligent stewards of your money and only invest when the expected returns on projects are above our cost of capital. Today, we have a threshold requirement of 16%-20% equity IRRs. There are many opportunities in our view to achieve returns above our minimum thresholds. While we have competitive advantages that allow us to achieve returns within our targeted ranges in the plain vanilla renewable energy projects, we expect that an increasing portion of our growth will come from areas that have higher returns and where there is less competition. We have competitive advantages in intelligent energy solutions, on the M&A side and the corporate PPA market that many of our competitors will not be able to address for some time.
We have a large market share of projects that require intelligent energy solutions which have higher returns and lower levels of competition. We are also one of the best positioned to be the consolidator of choice in India, and these acquisitions have the potential to have higher returns than plain vanilla projects, given the amount of synergies that we are able to capture and an incumbent of scale. We are also very excited about the corporate PPA market, which provides significant upside to the guidance we have provided to investors. We've said, we continue to be active on the M&A front as well. We have closed both of our recently announced acquisitions, a 99 MW hydro facility and a 260 MW solar project in Telangana.
There are a significant amount of assets up for sale currently, and based on current market dynamics, we believe that we can purchase projects and achieve a better return in the plain vanilla renewable energy market. We are on track to have 8.2 GW operating by the end of this fiscal year. Currently, we have 7 GW operating, as I said earlier, or about 600 MW more than our capital market update about a month ago. We expect another 400 MW to be online over the next few weeks. I must also say that recently we received a recognition by Fortune Magazine globally as being one of the top 10 global companies that will change the world.
In addition, we're the only renewable energy company to have received the Lighthouse Award by the World Economic Forum for our proprietary development of AI technology to improve the operations of renewable energy facilities. Let me now turn it over to Kailash Vaswani to discuss the quarterly results and the half-year numbers. Kailash Vaswani, over to you.
Thank you. Thank you, Sumant. We have 7 GW operating as of today. We were at 5.6 GW at the beginning of this fiscal and are projected to end the year at 8.2 GW. The 1.4 GW addition was particularly commendable given the challenges of COVID and supply chain disruptions. Page 10 compares our revenues, EBITDA, and cash flow to equity to the comparable period in the previous year. Our revenues, labeled as total income under IFRS in the first half of this fiscal, 2022, rose 26% year-on-year, while our adjusted EBITDA increased 28% and cash flow to equity jumped 84%.
Turning to page 11, which provides a reconciliation of weather-adjusted EBITDA to the reported results. Our weather-adjusted EBITDA in the first half of FY 2022 was $470 million or about 58% of our FY 2022 weather-adjusted EBITDA of $810 million guidance. Weather improved from last year, although it remains below normal level and had about $40 million negative impact in the first six months of this fiscal year. At the moment, there is no evidence to shift our forecast of long-term average production levels or generation levels. We would note that our projections have been verified multiple times over the past several years, not only by us, but also by numerous private equity and debt investors that invested in the company. We will continue to undertake studies to review the veracity of our wind resource forecasts.
Our FY 2022 capacity additions remain on track to achieve our target of 8.2 GW operating capacity by the end of this fiscal year. As Sumant mentioned earlier, we commissioned 400 MW of new capacity since the end of the quarter and also added 260 MW from the completed acquisition of solar assets in Telangana, bringing our total operational capacity to approximately 7 GW today. Another 400 MW of capacity is scheduled to be finished over the next couple of weeks, which bring the exit operating capacity at the end of the calendar year to 7.4 GW. One of the frequent questions that we get asked is about supply cost inflation. The project costs for the megawatts that we added during the first half of this fiscal had very little impact for higher supply costs.
While there have been some increase in the cost related to the budget for the projects we are delivering for the remainder of the year. After considering the lower financing costs that we are able to realize in the market today, we continue to expect that our projects under construction will deliver an equity IRR within our targeted range of 16%-20%. With regards to the accounts receivable, we believe that the past due DSO at the end of the second quarter 2022 is at a peak level and they will improve going forward. The combination of company initiatives, legal and regulatory proceedings, government support, improvement in electricity demand and shift towards central government agencies that have a strong record of on time payments, all these will result in a major improvement in DSOs over the next several years.
We are taking an even greater active role in managing our receivables with discounts, with continuous discussions and monitoring with off-takers through dedicated teams and senior management committees. We have even begun pursuing court actions for states that are particularly behind in payments and expect that over the next three months to get favorable court rulings. With regard to Andhra Pradesh, the court has scheduled the next hearing in December, which we expect will be the concluding hearing. We will continue to update the market on new developments, but ultimately we are confident in winning the case and recovering all the past due amounts. Finally, on balance sheet, we had about $1 billion of cash and cash equivalents, and our net debt stood at approximately $4.4 billion. With that, I will now turn it over to Sumant for guidance and closing remarks.
Yeah. Thanks, Kailash. I'm very happy to report that despite the uncertainty around supply chain issues and COVID, we continue to be on track with our guidance. For this year, we continue to expect to achieve $810 million of weather adjusted EBITDA. $40 million is the impact of the weather so far, to have 8.2 GW operational by the year end. Turning to slide 15 in the presentation, we are also reiterating our guidance provided during our Capital Markets Day last month. Once our 10.3 GW portfolio is completed over the next 18 months or so, we expect that EBITDA from that will be at least $1.1 billion.
We expect that we will have about $5.7 billion of net debt on our books on a 4.9 debt-to run rate EBITDA leverage ratio, once the 10.3 GW is completed. We expect our cash flow to equity run rate to improve meaningfully as well from $192 million in the first six months of fiscal 2022 to approximately $400 million on an annualized basis once the 10.3 GW are operational. Importantly, our portfolio is fully equity funded. In fact, we do not need any new external equity for 18 GW. At 18 GW, our cash flow generation should be sufficient to self-fund 2.5-3 GW of growth annually without raising any external equity.
We will consider options in the future to recycle capital that could increase our growth, improve our returns and reduce risk. With this, we will be happy to take any questions. Thank you.
Thank you. If you wish to ask a question please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request please press star then two. If you are on speaker phone please press the hand to ask your question.The first question comes from Julien Dumoulin-Smith with Bank of America.
Great team. Well done on sticking through all of the many questions we had already, admittedly. Team, if we don't mind going back to some of the prepared comments you alluded to, corporate offsets here. Frankly, given the higher energy backdrop, and specifically some of the shortages highlighted of late across the country, can you comment a bit on just how much of an uptick you're seeing there, sort of in real time, and how much that could add sort of in the medium-term pipeline?
Yeah, Julien, absolutely. You know, as you're referring to the corporate PPAs and whether we are seeing any uptick there as a result of the power supply issues. You know, the power supply disruptions in India were relatively short-term in nature. I would say that things, you know, with coal supplies having been restored post the monsoon period, we are seeing power prices having more or less settled down.
Having said that, while that might not be a big, necessarily a big driver for corporate PPAs, the reality is that there is a very strong commercial rationale for corporates to now start buying power directly from companies like us, because we can sell them power through the grid for utility scale projects at prices which are lower than what they're able to buy from the grid. Keep in mind that in India, corporate customers are charged some of the highest tariffs among all customers in the country. Very frequently, corporate customers pay between, let's say, $0.07-$0.08 to about as high as $0.15 a KW .
Against that, we can supply them fully landed power at prices which are, you know, 15%-20% cheaper than what they might be having to pay from the grid, even if we take, you know, the lower end of that range of $0.07 or thereabout. There is, as I said, a very strong commercial rationale for them to buy power directly from us. In addition to that, as we all know that there is now an increasing ESG pressure on various corporates. The securities regulator in India recently came out with much stronger disclosure requirements on ESG. All of that is therefore enhancing the transparency of what these companies are doing on the ESG front.
That is also putting pressure on corporates to now shift towards going green and going clean wherever it is possible. For us to show up with a commercially viable solution for them ends up being a very positive outcome from their standpoint. We are having a lot of conversations with corporates right now, and hopefully you will see some more news on this front as we go forward. You know, we've already signed about 100 MW worth of PPAs with corporate customers that we have now included in our total number, which is why you see the number at 10.3 GW at this point. As I said, you'll see more progress on that front, hopefully in the short term.
Excellent. Thank you, team. Maybe if I can pivot here, I noticed you didn't comment too much on the incentives from the government on building manufacturing capacity here. Can you comment on the latest with respect to your own expansion plans, sizing and just how far you wanna go on the vertically integrated size? Is 2 GW still the number? Can you talk about just the prospects for the government to expand the incentive structure itself? Obviously, robust demand to participate in the structure. I'm just curious, what are you seeing more formally now to kind of expand that, if you will?
Yeah. Let me see if I understood your question correctly. You asked what is our current plan for solar manufacturing and what is the government doing on announcing the results of the manufacturing agenda?
Yeah. Basically that.
Yeah. Okay, let me answer that question, the latter question first. At this point, the government has not yet made up its mind on how much to allocate to the manufacturing subsidy quantum that they had originally announced as INR 600 billion. They have said that they're going to increase the amount substantially, but we are still waiting for a final decision on how much they're going to increase it by. We don't have an answer to that question yet. As you know, we had applied for 4 GW of wafer, cell, and module capacity under that scheme. We await the outcome of that scheme to see what is finally decided.
We understand that the decision is fairly imminent and within, I would say, by the end of this calendar year, we should be seeing their final point of view. Again, it's government functioning and so, one can't be 100% sure on the timing. As far as our current plans are concerned, as you know, we had announced doing a 2 GW cell and module line. So we are at this point going forward with that, because regardless of whether we get the Production Linked Incentive or not, we believe that covering, you know, a piece of our or a percentage of our manufacturing of our IPP capacity, sorry, is something that we need to do from a strategic standpoint.
We are certainly going ahead with those plans, and we still expect our output to start or our factory to start generating by the end of next calendar year. Now, at this point, the 2 GW that we're looking at will essentially cover maybe about half of our total requirement. At some point in the future, we will consider whether we want to stay with that number or that percentage or whether we'd like to cover a larger percentage of our total in-house production generation requirement. That is something that we are working on at this point. We're looking at various state level incentives as well, because some of those are also changing and you know changing the attractiveness of setting up capacities.
Based on that study, we will then take a call on what is the final number that we go with, or we might do it in a phased way. At this point, we're looking at considering with our 2 GW module capacity.
Got it. Actually, just quick clarification from the comments you made earlier. I think you said you'll continue to undertake studies to review the veracity of the wind forecast. Is there a specific timeline for that study, or is that more of an ongoing effort, if you will?
No. Obviously, Julien, wind is something that we look at all the time because that's obviously very central to the quality of our forecast, and we want to make sure that we are as right as possible. At this point, we want to wait for this full year to finish, the full financial year to finish to see where we end up at. Then, you know, we will engage with the wind forecasting companies and sit down with them and see whether the experience of the last two years merits any change in the forecast. I'm sure they will come, you know, with a scientific analysis to give us an answer one way or the other.
Then, you know, based on that, we will take a decision on what is to be done, whether in fact that the this year and the previous year are aberrations to the downside of the long-term mean, but are overall within the trend which we are forecasting right now as a long-term mean, or whether there is in fact some substantial change that we need to now factor in. At this point, we don't have any such view, and therefore, we are maintaining a long-term forecast. We should also keep in mind, Julien, that in the years leading up to these last two years, we actually had performance which was better than in some years, better than expected as well.
You know, we don't want to be reactive to this issue, but at the same time, we want to be responsive. I think we will wait for this year to finish before we make any assessments or make any changes.
Excellent. Thank you for all the responses today. Best of luck. We'll chat soon here.
Yeah. Thank you, Julien.
Thank you. The next question comes from Justin Clare with Roth Capital.
Hi, everyone, thanks for taking our questions. I guess just to
Thank you.
Hi, just to follow up on the last question there. I was wondering if you could give us a bit more color on the negative weather impact experienced in the first half. Like, just how much lower than the typical average were wind speeds? And then also did solar perform as you would expect in, you know, in a normal environment?
Justin, I think as we said earlier, the wind performance was about 5%-7% lower than the long-term wind speed would have indicated. That is where we were on wind. On solar, we were approximately 0.1% off as far as the overall generation was concerned. Solar was, you know, more or less within the overall range, you know, that you might expect in a half a year, because ultimately this was a half a year period out of the full year. It really depends on the vagaries of the monsoon and the cloudiness during that period of time. You would, you know, in the normal course have some degree of variability in solar as well.
Usually, as you know, solar doesn't move by more than a few percentage points across the mean. The shorter you take the time, the more the variability is likely to be. At this point, I would say that solar is, you know, nothing to really comment about. Wind really, as I said, was the big one, which was in fact 5%-7% off against the long term mean. I should also say that at the same time of last year, the wind was actually off by about 12%-15% in the same time period. It's actually retraced back substantially from last year's performance, but it has still not come back overall to the mean level that we have forecasted the long term level.
Okay. Got it. That's helpful. Then you had talked about IRRs for projects that you expect to complete this year. Was wondering if you could talk about the potential impact that cost inflation could have on IRRs for projects in fiscal 2023. You know, for how many of those projects have you already locked in pricing for equipment versus, you know, how many projects do you still need to procure equipment? Just what is the risk level to the IRRs for next year's projects?
Yeah, sure, Justin. That's of course a very important question. For FY 2022, as you know, we have more or less locked in all the CapEx. Everything is more or less done. As you know, we are in very advanced stages on commissioning those projects. Therefore, we know exactly what the CapEx is, and it's not, you know, there's no other significant deviation from the assumptions that we had made. If anything, on the existing projects, there is in fact an improvement because of interest rate reductions. As far as projects meant to be commissioned next year are concerned, there are two different buckets as you know. One is wind and the other is solar. On the wind projects, we have longer lead times for execution.
Those projects we've had to lock in the wind turbines for recently. In those, we have actually incurred higher CapEx than we had expected by 7%-8%. Those are in fact going to overflow versus the capital cost that we had originally estimated by approximately 5% because, you know, turbine costs account for about 70% of the total cost. There are of course some commodity price increases on the balance of systems, but there are things like land costs and so on which have not escalated. The overall net increase would be maybe a couple of percentage points lower than 7%-8% at an aggregate project level.
As far as solar is concerned, you know, most of the solar execution we have to do is very back-ended into next year, and we will be procuring modules for those projects only around the same time next year. We have a fairly long gap between now and then, in which we are hoping that prices will revert back to normalcy. Now, of the total 2.1 GW that we expect to commission towards the back end of next year, it's roughly half wind and half solar. As I said, the wind part is now locked in, albeit at higher prices than we'd expected. The solar part, again, the balance of system costs are not really accreting as much. There we don't expect to see an increase.
On the module price, which accounts for about 50% of the total capital cost, as you know, at this point, module prices are escalated. We are expecting them to start correcting from the second half of next year, post-Chinese New Year, early next year. As you know, the power situation in China settles down, more capacity of module manufacturing comes back on stream and the polysilicon shortage issue also begins to get addressed. We expect module prices to come back. How much they come back, do they come back fully to the level that we were expecting? Of course, we'll have to wait and see.
Again, keep in mind that for all of these projects, we have been able to get financing costs that are much lower than what we'd expected. Therefore, notwithstanding the commodity price increases, the turbine price increases for the next 2 GW that we still have to commission on our entire aggregate of projects that are left to be commissioned, we're actually seeing a very, very marginal impact on overall equity IRRs because the commodity price increases are being offset to a large extent by reduction in interest rates.
Okay. Then maybe one more for me. It looks like of your committed projects, you know, 1.2 GW have an LOA but not yet a PPA. Can you give us a sense for when you expect to sign those PPAs? Given that expectation, do you anticipate completing all of those projects that are committed right now by the end of fiscal year 2023, or is there some potential that some projects move into fiscal year 2024?
Yeah. You know, we have made I think a lot of progress on signing the PPAs on some of these projects. Therefore, hopefully, as we'll be submitting over the next short period of time, you should see some of those PPAs converting. Some will convert sooner, some will take longer to convert. Having said that, we have basically been working, or we've already started working on actually executing on these projects because we have a fairly good sense that those PPAs will come through eventually. We are not essentially waiting for the final signing to happen. We are actually starting work on, at least on land acquisition and those kinds of things, which are fairly generic in nature, which in any case we would have to do.
Those are the long lead time items as well. So those are things that we started working on. I think your question of whether in fact that might result in an overflow beyond end of FY 2023 is a fair one. I think the longer the PPAs take to get signed, the more likelihood that some of those projects might spill over into early FY 2024. I think that it'll get done literally within the first six months of the calendar year 2023. Within that time period, all these projects will get done regardless because you know, as I said, we are starting on some of the construction of these projects.
Therefore, some projects should happen before the end of financial year, some may spill over by a couple of months given there. It's hard to give that assessment right now.
Okay. That does it for me. Thank you.
Thank you, Justin.
Thank you. And once again if you wish to ask a question please press star then one on your telephone and wait for your name to be announced. The next question comes from Angie Storozynski with Seaport.
Thank you. We've seen some press reports about additional round the clock or baseloads wins, including you guys. Not sure if you can comment on that. Secondly, during the Capital Markets Day, you talked about a battery RFP, and I was just wondering if there's any resolution of that RFP.
Sorry, Angie, what was the second part of your question?
I'm sorry. Starting with the batteries. I was thinking that you guys were about to select a battery provider for your existing-
Yes. Yeah.
Round the clock, contracts.
Yeah.
Secondly, we've seen some press reports that you guys won an additional baseload renewable contract, and I was just wondering if you can comment on either one.
Yeah, you're right. There was a bid for a 2,500 MW baseload RE plus thermal bid, but in which you could also bid assuming only RE, which is what we did. We qualified under the overall bucket of 2,500 MW. But the tender had a certain condition which required us to match the lowest bidder, and the lowest bidder was in fact somewhat lower than us. And at this point, you know, we have not yet made public what our final decision on that issue is.
I think in the near term, we will let you know what our decision is on whether we want to match the L1 and go ahead or not. So that is where that tender is. I should say that the L1 number was quite lower. It was about 6% lower than where we had bid. So therefore there is a delta between where we thought the pricing should be and where the L1 bidder was. I think in the near term, we'll find out what our final decision is on that one. But regardless of what happens in this bid, there will certainly be a number of other bids that'll be coming out.
Hopefully bids that are better designed than this last one because of these, you know, these bidding infirmities that which caused a problem in this one. There will regardless be a number of other bids that'll be coming out because most distribution utilities really want this product now, where they get renewable energy and they get high PLFs. It you know is much more suitable for them. It does not require them to think very much about balancing the grids and so on. This is a product that they are really quite enthused with. As I said, the central government is already preparing to bring out more bids in this area.
As far as your second question on batteries was concerned with respect to our earlier bid of round-the-clock power, you're right, we did call for RFPs on that bid. We've received about 10 different proposals, and we are in the process of evaluating which final company to partner with for that particular installation. We have not yet again made that public as to who we are going with. We are in the process of negotiating that with a few companies right now.
Okay.
I will say that.
Just one other
If you talk to FDI. Go ahead.
Okay. Just one other question about EBITDA margins. It seems like the expansion of margins is mostly a function of the growth of the installed capacity, right? Just the economies of scale associated with basically corporate overhead, is that fair?
To some extent, yes. Keep in mind that our corporate overheads are a very small percentage of our overall EBITDA margin. You know, as you know, our EBITDA margins are in the 85%-86% level, in which the O&M costs or the costs that are variable in nature are about 8% or 9%. The corporate overhead costs are actually maybe only a few percentage points. Those, I would say it really depends on how much you want to invest for future capacity building and growth. In general, if you were to stand still, then those corporate costs would, as a percentage of overall revenue, keep going down.
Okay, I understand. Then one last one about the receivables, and I appreciate that you guys said that you know, they basically peaked in your latest quarter. I mean, does that make any difference versus your projections of cash flow, the working capital element here? If you think that this moderation in the receivables cycles were not to happen in the second half, how would you track versus your expectations on the free cash flow side?
Yeah. Hi, Angie, thanks for that question. As far as delay caused by receivables are concerned, if you see our repayment profile on the debt, you know, it's reasonably small. We are able to actually, you know, sort of fund it out of the collections that we are getting anyway. There's only a very small part that comes from, you know, sort of our receivables to actually fund the repayments that are required at the SPV level. It won't have any material impact on either our cash situation or our, you know, CapEx. You know, there is no need for us to phase out the CapEx, you know, due to lack of money available caused by poor receivables.
You know, like I said, we will keep monitoring.
I think just to add to that, Angie, the issue is that we are fairly well capitalized right now, so we have a fairly large amount of cash. At this point, the stress of the receivables is not causing us to change any of our current plans. Also typically at this time of the year, we do see receivables spiking because a lot of our generation happens in the monsoon months, and that then tends to get paid out over the few months after that. Between now and March, you'll see some of the receivables in the normal course tending to come down. This is not entirely unusual, but of course it's at a slightly more elevated level than it normally would have been.
We have sufficient cash buffer right now to take that into account.
Very good. Thank you.
Great. Thank you.
Thank you. There are no further questions at this time. I now return the call back to management for any closing comments.
Thank you everyone. Really appreciate your interest. If you need anything, please feel free to reach out at ir@renew.com. Thank you very much.
Thank you all. Bye-bye.