Juniper Green Energy Limited (Neutral)

Highlights

Juniper Green Energy Limited (JGEL) incorporated in 2018, is independent power producer (IPPs) company which develops, build, operate and maintain utility scale renewable energy projects through their in-house EPC team and O&M team, and generate revenue through the sale of electricity to various off-takers, including central and state government-backed entities.

As part of their in-house capabilities, they manage the end-to-end lifecycle of renewable energy project development across all critical stages, including: (i) bidding and auction; (ii) site prospecting; (iii) land acquisition and grid permits; (iv) engineering and technology; (v) procurement; (vi) project financing; (vii) plant construction and commissioning; (viii) O&M.

JGEL had an existing land bank of more than 12,000 acres for the installation of solar projects and more than 300 WTG locations in states like Rajasthan, Maharashtra, Gujarat and Madhya Pradesh, which have high renewable energy resources potential. Further, JGEL had a diverse base of off-takers, comprising central government entities such as SECI, SJVN, NHPC and NTPC, state government entities like GUVNL and MSEDCL, and private entities such as The Tata Power Company Limited (TPCL).

JGEL has established strategic, long-term partnerships aimed at mitigating supply chain risks and ensuring sustainable O&M for projects. These include a WTG supply agreement with Envision and a wind operated electricity generator (WOEG) supply agreement with Suzlon Energy Limited; solar module tie-ups with First Solar (for around 1.60 years), Waaree (for around 2.20 years) and Goldi (for around 2.20 years), inverter supply from Sungrow (India) Private Limited; SVGs tie up with TBEA Xi’an Electric Technology Co. Ltd. (TBEA) and BESS with Envision.

Out of the total proceeds of Rs. 18,000 mn, Rs. 14,119 mn would be go repayment/pre-payment, in full or part of certain borrowings availed by the company and its subsidiaries, ~Rs. 3,881 mn would go towards general corporate purpose.

Key Highlights

• India’s Renewable Energy (RE) sector is set for significant expansion, supported by growing demand, favourable policies and innovative projects. India’s peak power demand is expected to grow at an annual average CAGR of ~6-7 pct between FY26-FY31, reaching 335-345 GW by FY31.
• JGEL adopt a selective and strategic approach to auctions, backed by in-depth regulatory and commercial analysis, identify high-potential sites using Geographic Information System (GIS) tools, irradiance datasets and wind resource assessments. By integrating EPC and O&M functions in-house, we retain construction margins typically passed to third-party contractors.
• 97.68 pct of JGEL total capacity (in terms of MWp) is backed by long-term PPAs which are typically for 25 years with creditworthy counterparties with ratings of A or above, providing visibility on stable and predictable cash flows with the balance comprising merchant projects.
• JHEL has 20 Operational Projects with an installed capacity of 1,794.80 MW, 19 Under Construction Contracted Projects with a planned capacity of 2,875.40 MW, 11 Under Construction Awarded Projects with a planned capacity of 3,240 MW which also consist of 4563.88 MWh of BESS Capacity.
• As per JGEL estimates, the total grid permits required for their under-construction projects is ~4,407 MW at the Central Transmission Utility (CTU) level. JGEL have secured grid permits to ~6,095 MW at the CTU level. Accordingly, they hold an additional unallocated grid capacity of 1,688 MW at the CTU level, which is available for future projects. In addition to this, JGEL has also applied for grid permits for 2,410 MW at CTU level to further scale operations.
• JGEL’s key growth strategies include (i) To capitalize on the growing renewable energy sector in India. (ii) expand and diversify portfolio of projects and gain market share. (iii) To invest in supply-chain and procure critical components on time and in a cost-effective manner. (iv) Integrating advanced digital technologies into renewable energy operations (v) To diversify funding sources, optimize cost of capital and identify partners/investors for future growth.
• The sales of the company have grown by 41.3 pct CAGR over FY24-26 and EBITDA/profit has grown 36.6 pct CAGR/0.5 pct CAGR over same year. In FY26 the company reported sales of Rs. 7,189 mn, which rose 41.3 pct YoY. EBITDA of the company increased 42.5 pct YoY to Rs. 6,922 mn. In FY26 the company posted profit of Rs. 405 mn, up 10.9 pct.

Key Risk

• The reduction, modification or cancellation of government and economic incentives may reduce the economic benefits of JGEL’s existing renewable energy projects and their opportunities to develop or acquire new renewable energy projects.
• JGEL have entered into PPA with several central government/state government entities and have limited ability to negotiate the terms of such PPA which may contain onerous terms and any breach of these terms could result in the termination, and in turn could have a material adverse effect on JGEL business.
• JGEL’s contingent liabilities were 64.56 pct of book value. If they materialize, it may affect financial condition and cash flows.

Financial Performance

Source: – RHP.

Peer Comparison based on FY26 Financials.

Valuation

JGEL is amongst the top 10 largest renewable IPPs in India in terms of total capacity and their portfolio includes Wind, Solar, Wind-Solar Hybrid (WSH) and Firm & Dispatchable Renewable Energy (FDRE) projects, including BESS. JGEL total portfolio stood at ~10,247 MWp which spread over 50 Projects across four states in India. At the upper end of the price band of Rs. 225, the issue is priced at an EV/EBITDA of 31.5x its FY26 post issue capital. The issue appears to be fully priced.

Disclaimer: The views shared in blogs are based on personal opinions and do not reflect the company’s views. Investment involves risk, and it is advisable to consult a financial advisor before making any investment through the app. The decision to invest is solely that of the investor, and the company or its communication cannot be held responsible for it.