ReNew chairman says it will make money from its solar manufacturing business

GANDHINAGAR: Nasdaq-listed ReNew Energy Global is looking at monetising its solar panel manufacturing business and may approach private equity investors to raise funds, its founder, chairman and CEO Sumant Sinha said.

In an interview on the sidelines of the RE Invest 2024 conference, Sinha said the company will continue to look into various options to raise funds for its manufacturing operations. The renewable energy company has pledged to increase its solar panel and cell manufacturing capacity to 6 GW each by the end of the decade. Currently, the company has 4 GW of solar panels and 2.4 GW of cells.

“We will continue to watch the market, continue to work on plans, talk to bankers, see if there are opportunities and take advantage of them. We can also find other ways to make money without having to go directly to the (public) markets. There is capital in the private markets as well,” he said.

Talking about the listing plan of the solar equipment business, he said that it may take some time for the business to go public as the business scales up. “For the public market, we have to think about the timing, when is the right time, it may take more time as our business is still a fairly new business. If that is the case, we can go to the private market first,” Sinha added.

The company has commissioned two solar manufacturing plants in Jaipur, Rajasthan and Dholera, Gujarat, with a cumulative solar module production capacity of 6.4 GW. According to the company’s annual report for fiscal 2024, it plans to commission 2.5 GW of solar cell manufacturing capacity this fiscal year.

Speaking about the commitments made at the RE Invest 2024 renewable energy investor conference, the chairman said the company will increase its power generation capacity to 40 GW by 2030. Currently, the company has 10 GW of power generation capacity in operation and another 12 GW in the pipeline. He said the company’s upcoming power generation capacity will mainly consist of solar projects.

In May, Societe Generale agreed to lend up to $1 billion over the next three years to ReNew for its energy transition projects as the company aims to expand its presence in green energy and decarbonization.

CEO: Will also focus on green hydrogen production

Sinha said the company will focus on the production of green hydrogen, besides adding capacity in its power generation and manufacturing businesses. ReNew has formed a joint venture with Indian Oil Corporation Ltd and Larsen & Toubro to produce green hydrogen. Separately, ReNew has signed an agreement for its subsidiary ReNew E-Fuels Pvt Ltd to collaborate with Japan’s largest power generation company JERA Co. Inc. to jointly evaluate the development of a green ammonia production plant in Paradip, Odisha.

The ReNew chairman said the growth in this emerging sector was not as expected initially but would pick up once offtake contracts were signed.

“The market is moving much slower than everybody expected, governments around the world have set targets for 2030 but they are not moving in that direction as fast as they need to be. So obviously the whole industry is moving much slower than expected. (But) this is going to happen because it’s inevitable,” he said.

“When people get offtake contracts, the industry will move forward. Meanwhile, we have just completed our projects and are now waiting for offtake contracts to come. Not only us, but the entire industry is waiting. When these contracts come, people will start investing in capex. Until then, people will just sit back and wait.”

ReNew was founded in 2011 and went public on the Nasdaq three years ago through a merger with a SPAC (special purpose acquisition company). SPACs are publicly traded shell companies that merge with unlisted companies to take them public, thus eliminating the time-consuming conventional initial public offering (IPO) route.