ReNew to monetize its solar manufacturing business, says chairman

Gandhinagar: Nasdaq-listed ReNew Energy Global is looking at monetizing its solar components manufacturing business and may approach private equity players to raise funds, its founder, chairman and CEO Sumant Sinha said.

In an interview on the sidelines of RE Invest 2024 here, Sinha said that the company would continue to look at multiple options to raise funds for its manufacturing business. The renewable energy company has committed to increase its solar module and cell manufacturing capacity to 6 GW each by the end of this decade. Currently, the company’s solar module and cell capacities are 4 GW, and 2.4 GW, respectively.

“We will keep looking at the market, we will keep looking at the plans and talk to our bankers and see if an opportunity presents itself, and take advantage of it. We can find other ways of monetizing as well, without going to the ( public) market directly. There is capital in the private markets as well,” he said.

Speaking on plans to list the solar equipment business, he said that it may take some time for the business to go public as its operations scale up. “For public markets, we will have to look at the timing, when would be the right timing, may need some more time because our business is still a pretty new business. If that is the case then we can go to the private market first ” Sinha added.

The company has commissioned two solar manufacturing plants at Jaipur, Rajasthan, and Dholera, Gujarat, with a cumulative capacity of 6.4 GW solar modules. A cell manufacturing capacity of 2.5 GW solar cells is scheduled to be commissioned in the current fiscal year, according to the company’s annual report for FY24.

Speaking of the commitments made at the RE Invest 2024 renewable energy investors meet, the chairman said that the company would increase its power generation capacity to 40 GW by 2030. Currently, it has a commissioned capacity of 10 GW and another 12 GW is in the pipeline. He said that the company’s upcoming capacity would largely consist of solar projects.

In May, Europe’s Societe Generale agreed to lend up to $1 billion for ReNew’s energy transition projects over the next three year, as the company aims to expand its footprint across green power and decarbonization.

Will also focus on green hydrogen production: CEO

Sinha said that along with capacity addition in the power generation and manufacturing businesses, the company would also focus on production of green hydrogen. ReNew has a joint venture with Indian Oil Corporation Ltd and Larsen & Toubro for green hydrogen production. Further, ReNew has signed an agreement for a collaboration of its subsidiary ReNew E-Fuels Pvt Ltd with Japan’s largest power-generation companies JERA Co. Inc. to jointly evaluate the development of a green ammonia production plant in Paradip, Odisha.

The ReNew chairman said that growth in this nascent sector has not been as anticipated initially, but would pick up once offtake contracts are signed.

“The market is developing a lot slower than everyone had anticipated and government’s around the world have set targets for 2030, they are not going in that direction at the pace at which they need to. So, obviously the whole industry is moving much more slower than anticipated. (But) It will happen because it’s inevitable,” he said.

“When people get offtake contracts then the sector will move ahead. In the meantime, we have just done project development and now we are waiting for the offtake contracts to show up. Not just us but the whole industry globally is waiting. As and when those contracts show up, people would start investing the capex. Until then, people are just going to sit tight.”

Founded in 2011, ReNew debuted on Nasdaq three years ago by merging with a SPAC (special purpose acquisition vehicle). SPACs are publicly-traded shell companies that merge with unlisted companies to take them public, skipping the time-consuming conventional route of initial public offering (IPO).