Dated: June 04, 2020 The Manager The Manager BSE Limited National Stock Exchange of India Ltd Corporate Relationship Department Listing Department Phiroze Jeejeebhoy Towers Exchange Plaza, 5 th Floor, Plot no C/1 Dalal Street G Block, Bandra Kurla Complex Mumbai- 400001 Bandra (E), Mumbai-400 051 Scrip Code: 540750 Symbol: IEX Sub: Investor Presentation Q4 FY 2020 Dear Sir / Madam, Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, please find attached an Investor Presentation for Q4 FY2020. The above information will also be made available on the website of the Company: www.iexindia.com You are requested to take the above information on record. Thanking You. Yours faithfully, For Indian Energy Exchange Limited Digitally signed by: VINEET VINEET HARLALKA DN: CN = VINEET HARLALK HARLALKA C = IN O = Personal A Date: 2020.06.04 13:02: 04 +05'30' Vineet Harlalka Company Secretary & Compliance Officer Membership No. ACS-16264 Encl: as above
Investor Presentation - Q4 FY’20 For Public Use
Sector in transformation Electricity value chain In this presentation IEX : Who we are Impact of COVID - 19 Way forward
Transformation drivers Deployment of low-carbon Small-scale generation across technologies - wind and solar. T&D network Decarbonization Decentralization Outlook: Outlook: • Renewables to become leading • RE a threat to centralized energy sources energy production • Emerging new tech like hybrids • Requirement of local solutions Intelligent CS and Apps to Empowered consumers - optimize plants and grid economic power shift Digitization Democratization Outlook: Outlook: • Digital Tech to promote • Peer to peer energy trading aggregation solutions
The energy shift Paris Climate Agreement – Renewable energy to constitute 40% Hybridization requires technology of total installed capacity base of 1250 GW driven apps and automation Bio-Power , 3% Solar , 9% Solar Bio- 20% Solar Power Thermal 36% 2% WInd , 10% 35% Small Hydro , 1% Wind Thermal Power 53% Hydro , 12% Thermal , 62% 12% Nuclear 2% Hydro Wind 10% Bio-Power Power Nuclear , 2% 1% Hydro 17% Small 8% Small Hydro Nuclear Hydro 1% 2% 1% 2020 2022 2030 Changing Installed Capacity Mix – Increasing reliance on RE Source: CEA
Sector in transformation Electricity value chain In this presentation IEX : Who are we Impact of COVID - 19 Way forward
Electricity value chain 3 Yr CAGR (%) Share of REN* CAPACITY (GW) 344 356 370 24% 15.0% REN FY'18 FY'19 FY'20 Thermal Nuclear Hydro RES 4.2% GENERATION (BU) Generation Transmission Distribution Energy 10% 1303 1372 1383 De-licensed is licensed licensed deficit 18.7% decreased REN Private World’s largest Rs 91,284 Cr O/S from 10% FY'18 FY'19 FY'20 sector ~46% network as of March to 0.5% 3.8% Thermal Nuclear Hydro Renewables PEAK DD (GW) 2020* over the Generation Pvt sector last decade 183 in distress ~8% 176 161 AT&C Loss FY'18 FY'19 FY'20 Peak Met (MW) • Source: PRAAPTI; CEA; MOP 5 year vision; press 5.2%
Power sector construct Bilateral (BU) Short Term (10%) (3Yr CAGR: 8%; YTD Feb’20: -4.9% YoY) Long Term (90%) 1,274 BU (incl REN)* 67 56 55 55 47 OTC: Exchanges: Up to 25 years Real Time 40 Intraday to 1 year Intraday – 11 days 34 28 27 21 19 17 54.7* BU 20.8* BU 1,146.3 BU 52.1* BU 4.1% 90.0% 1.6% Bilateral Direct Trader 4.3% FY17 FY18 FY19 YTD Feb'20 Exchange (BU) Exchanges DSM (BU) (Only up to 11 Bilateral & days) Deviation 54 52 47 41 ➢ DAC Banking settlement/ Long-term PPA 25 24 23 ➢ Daily 21 Transactions Unscheduled ➢ Weekly Interchange ➢ Day Ahead PXs DSM Market FY17 FY18 FY19 YTD Feb'20 • As of YTD Feb FY’20; CAGR calculated for 3 years ending FY’19 • Source: CEA, CERC
Share of power exchanges globally Exchange market as a % of total demand – Global 2 Exchange market and ST market a % of total generation (incl Ren) – India 1 10.6% 10.0% 9.9% 9.8% 9.6% 91% 49% 47% 39% 4.1% 3.9% 34% 3.6% 3.3% 23% 2.9% 15% FY16 FY17 FY18 FY19 YTD Feb'20 Power markets in developed economies are in the range of 30-80% of total power demand vis a vis 4% in India Source: 1. CERC; CEA; 2. CRISIL Study
Electricity consumption bound to increase • India a third of global average in per capita consumption Total Electricity Demand (BU) 1 • Economic activity will accelerate • Government envisions India as an industrial hub 1284 1268 • Core sector growth will drive electricity consumption 1205 • Rapid urbanization FY'18 FY'19 FY'20 • 17 of 20 world’s fastest growing cities in India Per Capital Electricity Consumption (KWh) 2 • Consumer demand growth 12,994 • 7,035 6,940 6,603 Last mile connectivity - Saubhagya : Power for All 3,927 3,127 2,601 1,181 • Power on 24x7 basis US France Germany Russia Global China Brazil India Average Source: 1. CERC; 2. World Bank; 3. CEA
Sector in transformation Electricity value chain In this presentation IEX : Who we are Impact of COVID - 19 Way forward
Who we are OUR VISION India’s leading power exchange – Nation wide, Automated and transparent • To be the architect of next- platform for physical delivery of electricity generation solutions for Commenced operations in 2008, Market Share: 95% • sustainable energy ensuring competitive, • Electricity CAGR ~40%, CERC regulated transparent and reliable access. • Average daily trade 6000+ MW • Record day volume : 308 MU’s (12,900 MW) • Our customer base Transparency 4000+ Industries I 55+ Discoms (all) I 100+ ESCert Entities 500+ Generators I 1500+ RE Generators & Obligated entities Liquidity • Publicly listed company (NSE and BSE) • Competition ISO 9001:2015, ISO 27001:2013, ISO 14001:2015
Benefitting Power Sector….and the nation • Provides benchmark prices for all electricity transactions • Transparent Mechanism for Price Discovery • High liquidity on exchange has ensured lowest cost and assured supply Truly benefited Indian Power Sector Transmission Distribution Generation • Investments in transmission - Lower power prices for Signals for Generating Capacity congestion free – One Grid One discoms, end consumers. addition (~35 GW Merchant plants) Price • Avoids buying under take-or- pay contracts. • Flexibility on 15-min basis
Our Market segments • Delivery for next day Day-Ahead • Price discovery: Closed , Double-sided Auction Market • Intraday: For Delivery within the same day Term-Ahead • Day Ahead Contingency: Another window for next day Market • Daily and weekly contracts Auction • Delivery after 1 hour of auction Real-Time • Price discovery: Closed , Double-sided Auction Market • Renewable Green Attributes as Certificates Continuous • Sellers : RE generators not under feed in tariffs Energy • Buyers: Obligated entities; 1MWh equivalent to 1 REC Certificates • 1 ESCert = 1 mtoe (metric Tonne of Oil Equivalent) Energy Saving • Trading Session on every Tuesday of the Week Certificates • Trading time 1300 hrs to 1500 hrs
Robust financial performance – Q4 2020 Consolidated Financials Rs Cr Breakup of Q4 FY FY Q4 FY FY standalone 90.0 90% 79% 2019 2019 2020 2020 80.0 80% revenues (%) 83% 82% 70.0 70% 60.0 60% Transaction Fees 77% 80% 80% 80% 50.0 50% 40.0 40% 30.0 30% Admission and 20.0 20% 6% 7% 7% 6% Annual Fees 10.0 10% 67.8 56.2 69.4 56.8 79.6 62.6 0.0 0% Q4FY19 Q3FY20 Q4FY20 Other Income 17% 14% 13% 14% Total Revenue EBITDA EBITDA Margin Robust business model and financial strength Source: Company
Launch of a new market segment Introduced a new market segment - Real Time Markets • Trading commenced on 1 st June 2020 • Market Features • • 48 bid sessions during the day; Each bid session for a duration of 15 minutes • First bid session starts at 2245 hrs • Double-sided anonymous auction bidding process • Exchange manages risk management • Day 1 performance of IEX • Traded 3.41 MU volume, Market share 99% • All key generation & distribution companies as well as the open access companies participate • Attractive average price discovered at Rs 1.55 per unit
Sector in transformation Electricity value chain In this presentation IEX : Who are we Impact of COVID - 19 Way forward
Impact of CoVID-19 on Indian Power sector • Being essential service, impact on power generation is likely to be less than other industries • IPP’s will be impacted – no PPA’s + anticipated fall in spot prices could drive them out of market • Limited impact on coal prices and coal logistics, solar module prices would increase • 62GW thermal, 11GW RE under construction projects likely to be delayed – debt servicing, project viability • Sustained lockdown to adversely impact industrial and commercial demand (~50% share) • Reduction in peak demand by about 25% in April and 10% in May • Fall in C&I demand will impact subsidies available to other consumers • Revenue collection will be impacted • Collection delays and defaults by consumers will impact payment to gencos and debt servicing to FI’s • Tariff revision for utilities could be deferred leading to revenue shortfall • Govt budgets to power sector could be diverted to COVID funding
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