TIDMGKO
RNS Number : 0068K
Greenko Group plc
19 June 2014
19 June 2014
Greenko Group plc
("Greenko", "the Company" or "the Group")
Preliminary Results for the year ended 31 March 2014
Greenko, the Indian developer, owner and operator of clean
energy projects, today announces its preliminary results for the 12
months ended 31 March 2014 ("the period").
Financial Highlights
-- Revenue grew 59.5% and adjusted(1) EBITDA grew 90.5% in constant currency terms
-- Reported Revenue grew 38.2% to EUR53.0 million (2013: EUR38.3 million)
-- Reported EBITDA increased 65.9% to EUR40.9 million (2013: EUR24.6 million)
-- Reported profit after tax increased 55.0% to EUR9.3 million (2013: EUR6.0 million)
-- Earnings per share increased 53.0% to 4.50 Euro Cents (2013: 2.94 Euro Cents)
-- EUR208.9 million invested in new capacity
Operational Highlights
-- Power assets grew 27% to EUR658.4 million (2013: EUR516.7 million)
-- Operational capacity more than doubled (+170.9%) from 244 MW
in March 2013 to 661 MW to date
-- Power generation grew 21% to 1,072 GwH (2013: 886 GwH)
-- Total of 348 MW of operational wind capacity ready for the 2014 season
-- Hydro acquisition of 70 MW Budhil hydro Project being
completed by 23, June 2014, taking hydro operational capacity to
235.6 MW
-- Approximately 423 MW of projects in construction and 1,240 MW in active development
Post year end
-- Additional 100 MW of new wind assets commissioned
1. Adjusted for the one-off non-cash 2008 LTIP charge in order
to enable a like for like comparison with the current year, but
including IFRS Fair value.
Commenting on the results, Anil Chalamalasetty, CEO of Greenko,
said: "We have more than doubled our capacity to 661 MW this year
to date, due to our structured development process which is focused
on the predictable and profitable phased roll out of utility scale
wind and hydro projects. As a result, we confidently expect to have
well over 680 MW generating by the 2014 monsoon."
He continued: "Today, Greenko is a mainstream player in the
power market in India, where our clean energy projects are
supplying at prices in-line with or cheaper than prevailing market
rates from traditional fuel sources. The drivers which underpin the
demand for power in our market are only getting stronger and we
remain extremely well placed to grow our asset base and secure
predictable, sustainable revenue streams at attractive margins.
Against this backdrop, we remain focused on commissioning new
projects, building on our now substantial base, and look to the
year ahead with confidence. Importantly, we remain on track to
reach our 1,000 MW target in 2015."
-Ends-
For further information please visit www.greenkogroup.com or
call:
Greenko Group plc
Anil Chalamalasetty/Mahesh Kolli/ Vasudeva
Rao Kaipa +44 (0)20 7920 3150
Arden Partners plc
Richard Day +44 (0)20 7614 5917
Investec Bank plc
Jeremy Ellis / Gary Clarence +44 (0)20 7597 4000
Tavistock Communications
Matt Ridsdale / Mike Bartlett/ Niall Walsh +44 (0)20 7920 3150
About Greenko
Greenko is a mainstream participant in the growing Indian energy
industry and a market leading owner and operator of clean energy
projects in India utilising a de-risked portfolio of wind,
run-of-river hydropower, natural gas and biomass assets. The Group
is now focused on building new utility scale wind farms and
hydropower projects across India. Greenko intends to increase the
installed capacity it operates by winning concessions to develop
and build new greenfield assets, as well as making selective
acquisitions which enhance shareholder value.
Greenko's portfolio is carefully planned and managed to ensure
it offers investors diversification and spreads its risk across a
number of projects that utilise various well-proven environmental
technologies. The Company's goal is to reach 1,000 MW of
operational capacity in 2015 and approximately 2,000 MW in
2018.
With a core belief in sustainability both operationally and
environmentally, Greenko endeavours to be a responsible business
playing an important role in the community beyond its role in the
power generation industry. The Company maintains a continuous
involvement in localised projects and community programmes which
centre on education, health and wellbeing, environmental
stewardship and improving rural infrastructure.
Greenko Group plc was admitted to trading on the AIM market of
the London Stock Exchange (LSE: GKO) in November 2007.
Report to Shareholders
Chairman's Statement
I am pleased to report Greenko's preliminary results for the
year ended 31 March 2014. The financial year has seen Greenko make
significant progress across all areas of the business, putting us
on a strong footing to deliver long term, sustainable returns. The
disciplined project development process, investments, and
infrastructure that we have put in place over the last three years
are now delivering strong growth in our operational asset base.
Since the end of the last financial year, we have commissioned
348.0 MW of wind projects with further phases at an advanced stage
of construction. The Company is well positioned to have over 680 MW
of operating capacity ready for the 2014 generating season, and
1,000 MW by 2015.
A good performance from our southern hydro assets saw generation
grow by 43.6%. This ensured that overall power output increased by
11% despite the northern hydro assets being affected by an extended
winter that resulted in a slower snowmelt. Wind assets did well
during their first year of operation, contributing significantly
both to revenue and generation.
Assets generating power grew from 244 MW to 491 MW. Shortly
after the end of the reporting period we reached 661 MW, including
the acquisition of the 70 MW Budhil hydro project. We expect growth
to accelerate over the next two years as we complete the 423 MW of
projects currently under construction, and most of the 1,240 MW of
projects currently in active development are moved into
construction. The recent addition of the Basvanbagewadi phase-2 (50
MW), Balavenkatpuram phase-3 (30 MW) and Ratnagiri Phase -2 (20 MW)
wind farms to access attractive tariffs in Karnataka, Andhra
Pradesh and Maharashtra give an indication of the depth of existing
development stage opportunities and our ability to focus resources
on the most profitable opportunities.
Clean energy is becoming an increasingly important part of the
Indian energy market and will provide a significant portion of the
Indian Government's 12th Plan target for new capacity. The Indian
energy market is witnessing a paradigm shift, with the emphasis
changing to price discovery using reliable supply contracts,
instead of unsustainable subsidised power. Given the major
shortages in domestic coal and gas supplies, the market now
reflects global commodity pricing in its long term base load supply
and financial return expectations. This effect is visible in the
bidding process across multiple states with tariffs well above
Rs5/kWh (Euro 80/MWh). Following the newly elected Prime Minister's
statement that thrust is to be 24/7 power availability in the
country, there is renewed alround enthusiasm in the Indian Power
Sector, with Renewable Energy being a priority.
Greenko's wind and hydro portfolio in most states can profitably
supply power below the price of conventional generation.
Additionally, some states, including Madhya Pradesh, have made long
term policy announcements which indicate their intention to
purchase power from wind projects at attractive prices in order to
encourage investments from Independent Power Producers (IPPs) like
Greenko. These factors, coupled with increased demand, means that
Greenko is well positioned to provide financially attractive,
sustainable long term returns.
The Company's profitable progress and strong underlying
operational performance was achieved despite a difficult economic
environment. The depreciation of the Rupee against the Euro by
approximately 18.7% has again led to foreign currency translation
differences in our consolidated accounts. Generation increased 21%
and power revenue increased 38%, despite the weakness of the Indian
Rupee, as our generating mix changed with the growth in
attractively priced and high margin wind power. On a constant
currency basis, power revenue grew 59.5%.
Outlook
In an environment of ever increasing demand for power in India,
the attraction of developing, owning and operating a diversified
portfolio of hydro and wind generating assets puts Greenko in a
strong position for profitable and sustained growth. Over the next
two years the shape and size of our operating portfolio will be
transformed, as the 392 MW of projects currently in construction
are completed. Despite challenges across the sector and exchange
rate volatility impacting the accounting treatment of our reported
financial metrics, we are confident that the quality of the
underlying assets should deliver substantial value to our
shareholders. We see Greenko emerging as a stable and leading
player in India's power generation sector for years to come and I
look forward to reporting further progress to you in the coming few
months.
Keith Henry
Chairman
Executive Directors' Statement
Introduction
I am pleased to present Greenko's preliminary financial results
for the 2014 financial year. We have delivered profitable growth
and the successful completion of multiple large wind farms which,
together with the existing portfolio, reinforce Greenko's position
as a mainstream IPP in the Indian energy market. Following the
successful raising of equity investment from GIC, the Singaporean
sovereign wealth fund, we have deployed additional capital to
deliver on our 2014 season target of 680 MW and put in place the
foundations for subsequent growth to reach 1 GW by 2015. Our
operational portfolio grew 170.9% to 661 MW compared with March of
last year and the total power portfolio under our control is now in
aggregate more than 2.2 GW. At the period end Greenko had 392 MW in
construction, 1,240 MW in active development and had deployed
EUR208.9 million into power assets during the financial year.
Financial Review
Reported revenue was EUR52.9 million (2013: EUR38.3 million)
from generation of 1,072 GWh (2013: 886 GWh). Adjusted EBITDA, net
of a one-off ESOP charge, but including IFRS fair value, is a key
performance indicator for Greenko and increased 67.3% to EUR41.1
million (2013: EUR24.6 million), despite being impacted by adverse
currency movements and lower generation from biomass assets.
Reported profit after tax increased by 55% to EUR9.3 million (2013:
EUR6.0 million). Of this, EUR2.5 million (2013: EUR1.66 million)
was attributed to minority shareholders, mainly the preference
share held by Global Environment Emerging Markets Fund III and
Government of Singapore Investment Company (GIC) through their
subsidiary have invested in the Group at the Mauritius subsidiary
level, and GE which invested in Greenko's wind holding company.
The Group invested over EUR208.9 million in power assets during
the year, primarily due to a significant increase in construction
activity. The cash balance at the end of the period was EUR46.4
million (2013: EUR35.8 million), with total borrowings of EUR350.3
million (2013: EUR247.9 million) and EUR77 million of committed but
undrawn facilities in place.
Operational and Development review
Greenko's generating portfolio strategy is designed around asset
clusters that offer economies of scale, as well as diversification
by geography, off-take and technology. Greenko reports on its
secured capacity in three categories: operating assets, projects
in-construction and concessions under active development. Together,
these represent over 2.2 GW of capacity, with 661 MW currently
operational and 423 MW in active construction. Having commissioned
the Basvanbagewadi Phase-2, Ratnagiri Phase -2 and Balavenkatpuram
Phase-3 wind farms in the last few weeks and completed the
formalities of a planned acquisition of Budhil hydro plant, Greenko
expects to have commissioned a total of 680 MW of operational
capacity ahead of the 2014 monsoon. We remain confident that 1,000
MW will be operational by 2015.
Hydro
Including the Budhil acquisition, Greenko currently has 235.25
MW of operational hydro and is one of the largest operators of
small hydro projects in India. There are a further 187.6 MW under
construction and the Company is continuing to assess selective
acquisition opportunities of projects at a late stage of
development, or which have recently been commissioned.
Over the period, our hydro assets performed well. An extended
winter and relatively weak summer meant that generation from our
northern hydro assets (71 MW) at 320 GWh was down by 4% on the
previous year (2013: 333 GWh), although still within normal year on
year variability. An early monsoon helped southern hydro generation
to recover to 221 GWh, a 43.6% improvement over the previous year
(2013: 154 GWh). Two southern hydro assets, of 35 MW, were
successfully moved from State PPAs to open market PPAs and the
impact of the resulting higher tariff should be apparent in next
year's results.
We have made further progress with the 187.6 MW of hydro
projects currently in-construction:
-- Dikchu (96 MW) in Sikkim is our largest hydro project and
remains on track to be commissioned ready for the 2015 monsoon. Key
components of the project are progressing well. Over 73% of the
underground civil works are complete, and works involving electro
mechanical and hydro mechanical are about 80% completed. The
majority of the Alsthom turbines and the electro-magnetic
components have been delivered to site and installation is at an
advanced stage. The project experienced delays due to abnormal
weather conditions earlier in the year, but remains on schedule to
begin commissioning for 2015's generating season.
-- Southern hydro cluster - Karnataka
o AMR-2 (10 MW) is a monsoon 'peaking' plant being built next to
the AMR and Rithwick (each 24.75 MW) complex. By using the existing
sub-station and site infrastructure, the overall cost is lowered
substantially. Construction has begun and commissioning should be
completed by August/September 2014.
o Kukkey-1 (24 MW) roads and infrastructure are in place. Work
on the impoundment structure began at the end of last year's
monsoon and equipment orders have been finalised.
o Kumardhara (24 MW) initial access work has started, with
equipment ordered for delivery in 2015.
-- Northern hydro cluster - Himachal Pradesh
o Paudital Lassa (24 MW) tunnelling has started and all access
roads are in place. Adit II portal construction is in progress,
with Erection & Maintainance Orders issued and construction
work is in progress.
o Jeori (9.6 MW) site work has started, with enabling
infrastructure ongoing. Construction of the access roads is
complete, with Head Race Tunnel excavation and other supporting
works in progress.
Wind
The Group's wind strategy is based on the extensive and
painstaking analysis of wind data over a significant period, to
deliver reliable long-term generating profiles on which the Group
bases its decisions to invest in utility scale projects, built in a
phased manner. Greenko has added 348.0 MW of new capacity, across
three sites, since the end of the last financial year. A further
30.0 MW is expected to be completed ready for the 2014 monsoon
generating period.
During the year, the Government of India reinstated the
Generation Based Incentive (Rs0.5/kWh capped at Rs10 million per
MW). Several states also raised their wind energy tariffs,
benefitting all three Greenko operating clusters. Greenko now has
over 975 MW of wind assets in active development, including 236 MW
of projects in varying stages of construction.
Progress at Greenko's key wind projects includes:
-- Ratnagiri Wind Farm (101.6 MW) in Maharashtra is Greenko's
first major wind project. Phase-1 (65.6 MW) was commissioned ready
for the 2013 monsoon. During the period it generated 118.8 GWh,
slightly ahead of expectations. The infrastructure for the full
101.6 MW capacity is in place and Phase-2 (36 MW) is under
construction with turbines already delivered and installation at an
advanced stage, of which 20 MW has been commissioned. Phase-2's
commissioning is planned to capture the 2014 wind season.
-- Basvanbagewadi Wind Farm (180 MW) in Karnataka is Greenko's
second major wind project. Phase-1 (51.2 MW) was commissioned at
the period end with GE 1.6 MW XLE turbines. The entire site's
infrastructure is in place, with a 180 MW grid connection that is
shared with the Matrix and Mangalore projects. Phase-2 (50.0 MW)
has been commissioned recently, using the Gamesa G-97 2.0 MW
turbines. A further 20 MW of capacity is being installed with firm
orders for additional turbines placed with Gamesa.
-- Matrix Wind Farm (15.0 MW) was commissioned in November 2013.
It is co-located with Greenko's Basvanbagewadi project and shares
its existing 180 MW grid connection. The project is selling its
power directly to a multi-national IT park near Bangalore, via an
attractive 10-year indexed power purchase agreement. It uses the
well-proven Vensys V87 1.5 MW gearless turbines made by ReGen.
-- Mangalore Wind Farm (15.0 MW) was recently commissioned and
is also co-located with Greenko's Basvanbagewadi project. It shares
the existing 180 MW grid connection and should be operational
during the current financial year. Its PPA and turbines are the
same as Matrix.
-- Balavenkatpuram Wind Farm (200 MW) in Andhra Pradesh is
Greenko's third major wind project. Phase 1 (51.2 MW) was
commissioned a month early in November and uses the enhanced GE 1.6
XLE turbines. The entire site's infrastructure has been completed
for the full 200 MW. Phase-2 (50.0 MW) has been commission in
January 2014 and Phase-3 (50.0 MW) of which 30 MW has been
commissioned recently using the Gamesa G-97 turbines. Phase-4 (50.0
MW) is in the planning stage, with construction expected to start
at the end of the 2015.
-- Tanot Wind Farm (120 MW) in Rajasthan is Greenko's fourth
major wind cluster and was initiated during the current financial
year. Land required for the project has been acquired and the
Company has accelerated this development since gaining clarity on a
PPA and has placed firm orders for Gamesa 2.0 MW turbines which
will be delivered after the monsoon season. The project is expected
to become operational in a phased manner, beginning early in 2015
and completed before the 2015 wind season.
Thermal
The 36.8 MW liquid fuel plant continues to generate operating
profit in line with expectations, using the existing quasi-tolling
structure. The Group's 41.5 MW of biomass assets continue to
operate below our long-term expectations and output was lower than
the previous period, as the plants were run to maximise cash
generation, rather than output. We expect to see an improvement
over the full financial year, as Andhra Pradesh's tariff was
increased in mid-November, while the Ravi Kiran (7.5 MW) plant in
Karnataka moved to a merchant tariff allowing access to better
prices. The Company has decided to exit two of its biomass plants
of 16.0 MW capacity located in Chattisgarh, an area and cluster
which is no longer of strategic importance to the Company. The
difference of EUR 1.1million to book value has been taken as a
one-off expense, consequential to this decision to sell these
units.
Business Development
With a significant portion of the current portfolio having
secured long term state PPAs, the Company is now working towards
increasing the proportion of highly attractive open market
contracts for new projects. We are working towards optimizing
revenue with a mix of open market tariffs and state PPAs, which
should improve returns and ensure appropriate levels of
diversification.
The Company's infrastructure, brand and standing within the
industry also bring access to a large number of acquisition
opportunities. Greenko continues to pursue a twin-track strategy of
developing new concessions and acquisitions in hydro, where we see
real opportunities to scale-up our business. As always, we remain
highly selective but expect to take forward an attractive
opportunity in the near future.
Our growth plans are unchanged and we remain focussed on
maximising shareholders' returns.
Anil Chalamalasetty
CEO
Consolidated statement of financial position as at 31 March
2014
31 March
31 March 2014 2013
Notes (Unaudited) (Audited)
------------------------- ---------------------
Assets
Non-current assets
Intangible assets 8 106,696,259 116,641,640
Property, plant and equipment 9 551,559,274 400,075,891
Bank deposits 14 10,447,037 7,542,157
Trade and other receivables 12 5,325,292 4,385,988
Other non-current financial assets 5,413,807 -
------------------------- ---------------------
679,441,669 528,645,676
------------------------- ---------------------
Current assets
Inventories 13 6,834,959 7,335,762
Trade and other receivables 12 48,095,194 42,780,524
Available-for-sale financial assets 11 53,280 60,910
Bank deposits 14 3,567,943 4,313,538
Current tax assets 395,066 -
Cash and cash equivalents 14 32,254,906 23,921,007
------------------------- ---------------------
91,201,348 78,411,741
Assets of disposal group classified
as held for sale 15 11,223,905 -
------------------------- ---------------------
Total assets 781,866,922 607,057,417
------------------------- ---------------------
Equity and liabilities
Equity
Ordinary shares 16 753,308 753,308
Share premium 201,336,875 201,336,875
Share-based payment reserve 118,126 -
Revaluation reserve - 4,035
Currency translation reserve (55,112,872) (17,375,265)
Other reserves 41,047,455 (3,405,542)
Option reserve (15,594,526) (15,594,526)
Retained earnings 30,347,287 28,954,634
------------------------- ---------------------
Equity attributable to owners of
the Company 202,895,653 194,673,519
Non-controlling interests 127,191,456 71,802,643
------------------------- ---------------------
Total equity 330,087,109 266,476,162
------------------------- ---------------------
Liabilities
Non-current liabilities
Retirement benefit obligations 22 355,793 371,746
Borrowings 18 278,165,338 229,812,108
Other financial liabilities 18.7 26,397,448 24,474,057
Deferred tax liabilities 19 34,036,363 35,470,245
Trade and other payables 17 2,498,844 2,064,903
341,453,786 292,193,059
------------------------- ---------------------
Current liabilities
Trade and other payables 17 33,090,345 30,201,891
Current tax liabilities 2,484,638 135,205
Borrowings 18 72,144,826 18,051,100
107,719,809 48,388,196
Liabilities of disposal group classified
as held for sale 15 2,606,218 -
------------------------- ---------------------
Total liabilities 451,779,813 340,581,255
------------------------- ---------------------
Total equity and liabilities 781,866,922 607,057,417
------------------------- ---------------------
The notes are an integral part of these consolidated financial
statements.
Consolidated statement of profit or loss for the year ended 31
March 2014
31 March 2014 31 March 2013
Notes (Unaudited) (Audited)
--------------------- ----------------
Revenue 20 53,010,821 38,345,397
Other operating income 21 266,011 3,645,725
Cost of material and power generation expenses (5,699,044) (7,441,941)
Employee benefits expense 23 (4,072,195) (8,101,711)
Other operating expenses 24 (4,763,819) (5,196,128)
Depreciation, amortization and impairment 8 & 9 (13,549,030) (9,007,074)
Excess of Group's interest in the fair value of acquiree's assets
and liabilities over cost 2,257,265 7,474,334
--------------------- ----------------
Operating profit 27,450,009 19,718,602
Finance income 4,744,150 3,584,103
Finance cost (18,708,152) (15,343,134)
--------------------- ----------------
Finance costs - net 25 (13,964,002) (11,759,031)
Profit before income tax 13,486,007 7,959,571
Income tax expense 26 (4,164,966) (1,944,131)
--------------------- ----------------
Profit for the year 9,321,041 6,015,440
--------------------- ----------------
Attributable to:
Equity holders of the Company 6,776,211 4,353,259
Non-controlling interests 2,544,830 1,662,181
--------------------- ----------------
9,321,041 6,015,440
--------------------- ----------------
Earnings per share for profit attributable to the equity holders
of the Company during the
year 27
* Basic (in cents) 4.50 2.94
* Diluted (in cents) 4.07 2.81
Consolidated statement of comprehensive income for the year ended 31 March 2014
31 March 2014 31 March 2013
(Unaudited) (Audited)
-------------- ----------------
Profit for the year 9,321,041 6,015,440
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss
Exchange differences on translating foreign operations (17,018,544) (656,551)
Items that will be reclassified subsequently to profit or loss
Unrealised losses on available-for-sale financial assets (1,373) (1,710)
Exchange differences on translating foreign operations (41,490,431) (3,220,167)
-------------- ----------------
Total other comprehensive income (58,510,348) (3,878,428)
-------------- ----------------
Total comprehensive income (49,189,307) 2,137,012
Total comprehensive income attributable to:
Equity holders of the Company (34,715,593) 1,131,382
Non-controlling interest (14,473,714) 1,005,630
-------------- ----------------
(49,189,307) 2,137,012
-------------- ----------------
The notes are an integral part of these consolidated financial
statements.
Consolidated statement of changes in equity (Audited)
Total equity
Share-based Currency attributable to
Ordinary Share payment Revaluation translation Other Option Retained equity holders of Non-controlling
shares premium reserve reserve reserve reserves reserve earnings the Company interests Total equity
---------- ------------ ------------ -------------- ------------- ------------ ------------- --------------- -------------------- ---------------- ----------------
At 1 April 2012 708,202 185,556,658 1,516,421 62,085 (14,158,270) (3,224,221) - 24,563,925 195,024,800 38,833,684 233,858,484
Transfer from
revaluation
reserve to
retained earnings - - - (54,878) - - - 54,878 - - -
Issue of share
capital (Net of
issue expenses) 45,106 6,193,672 - - - - - - 6,238,778 - 6,238,778
Transfer of share
based payment
reserve (refer
note 16.2) - 9,586,545 (9,586,545) - - - - - - - -
Sale of interest in
subsidiaries - - - - - - - (17,428) (17,428) 32,096,278 32,078,850
Recognition of
liability for
option - - - - - - (15,594,526) - (15,594,526) - (15,594,526)
Acquisition of
non-controlling
interest - - - - - (551,823) - - (551,823) (209,482) (761,305)
Increase of - - - - - - - - - - -
interest in
subsidiary
Value of employee
services - - 8,070,124 - - - - - 8,070,124 - 8,070,124
Government grants - - - - - 372,212 - - 372,212 76,533 448,745
---------- ------------ ------------ -------------- ------------- ------------ ------------- --------------- -------------------- ---------------- ----------------
Transaction with
owners 45,106 15,780,217 (1,516,421) (54,878) - (179,611) (15,594,526) 37,450 (1,482,663) 31,963,329 30,480,666
---------- ------------ ------------ -------------- ------------- ------------ ------------- --------------- -------------------- ---------------- ----------------
Profit for the year - - - - - - - 4,353,259 4,353,259 1,662,181 6,015,440
Other comprehensive
income
Unrealised loss on
available-for-sale
financial assets - - - - - (1,710) - - (1,710) - (1,710)
Exchange
differences on
translating
foreign operations - - - (3,172) (3,216,995) - - - (3,220,167) (656,551) (3,876,718)
---------- ------------ ------------ -------------- ------------- ------------ ------------- --------------- -------------------- ---------------- ----------------
Total comprehensive
income - - - (3,172) (3,216,995) (1,710) - 4,353,259 1,131,382 1,005,630 2,137,012
At 31 March 2013 753,308 201,336,875 - 4,035 (17,375,265) (3,405,542) (15,594,526) 28,954,634 194,673,519 71,802,643 266,476,162
---------- ------------ ------------ -------------- ------------- ------------ ------------- --------------- -------------------- ---------------- ----------------
The notes are an integral part of these consolidated financial
statements.
Consolidated statement of changes in equity (continued)
(Unaudited)
Total equity
Share-based Currency attributable to
Ordinary Share payment Revaluation translation Other Retained equity holders Non-controlling
shares premium reserve reserve reserve reserves Option reserve earnings of the Company interests Total equity
--------- ------------ ------------ ------------ ---------------- -------------- --------------- ------------- ----------------- ---------------- ----------------------
At 1 April 2013 753,308 201,336,875 - 4,035 (17,375,265) (3,405,542) (15,594,526) 28,954,634 194,673,519 71,802,643 266,476,162
Transfer from
revaluation
reserve - - - (4,035) - - - 24,729 20,694 (20,694) -
Issue of shares to
non-controlling
interests in
subsidiaries - - - - 3,752,824 44,454,370 (5,408,287) 42,798,907 69,883,221 112,682,128
Value of employee
services - - 118,126 - - - - - 118,126 - 118,126
Transaction with
owners - - 118,126 (4,035) 3,752,824 44,454,370 - (5,383,558) 42,937,727 69,862,527 112,800,254
--------- ------------ ------------ ------------ ---------------- -------------- --------------- ------------- ----------------- ---------------- ----------------------
Profit for the year - - - - - - - 6,776,211 6,776,211 2,544,830 9,321,041
Other comprehensive
income
Unrealised loss on
available-for-sale
financial assets - - - - - (1,373) - - (1,373) - (1,373)
Exchange
differences on
translating
foreign operations - - - - (41,490,431) (41,490,431) (17,018,544) (58,508,975)
--------- ------------ ------------ ------------ ---------------- -------------- --------------- ------------- ----------------- ---------------- ----------------------
Total comprehensive
income - - - - (41,490,431) (1,373) - 6,776,211 (34,715,593) (14,473,714) (49,189,307)
At 31 March 2014 753,308 201,336,875 118,126 - (55,112,872) 41,047,455 (15,594,526) 30,347,287 202,895,653 127,191,456 330,087,109
--------- ------------ ------------ ------------ ---------------- -------------- --------------- ------------- ----------------- ---------------- ----------------------
The notes are an integral part of these consolidated financial
statements.
Consolidated statement of cash flow for the year ended 31 March
2014
31 March 2014 31 March 2013
Note (Unaudited) (Audited)
-------------- -------------------
A. Cash flows from operating activities
Profit before income tax 13,486,007 7,959,571
Adjustments for
Depreciation, amortization and impairment 8 & 9 13,549,030 9,007,074
(Profit)/loss on sale of assets (18,950) 12,606
Share based payment 118,126 4,035,062
Finance income (4,744,150) (3,584,103)
Finance cost 18,708,152 15,343,134
Provision for impairment of trade and other receivables - 656,580
Excess of Group's interest in the fair value of acquiree's assets
and liabilities over cost 29 (2,257,265) (7,474,334)
Changes in working capital
Inventories (1,205,491) 136,231
Trade and other receivables (19,959,959) (2,762,102)
Trade and other payables 13,665,923 (665,855)
-------------- -------------------
Cash generated from operations 31,341,423 22,663,864
Taxes paid (1,076,930) (1,331,018)
Net cash from operating activities 30,264,493 21,332,846
-------------- -------------------
B. Cash flows from investing activities
Purchase of property, plant and equipment and capital expenditure (203,665,298) (87,599,077)
Proceeds from sale of property, plant and equipment 40,738 138,208
Acquisition of business, net of cash acquired 29 (5,303,384) (24,379,313)
Advance given for purchase of equity (2,002,631) (1,021,171)
Payment for acquisitions relating to earlier years (8,437,569) (358,118)
Acquisition of licence holding company (89,914) -
Bank deposits (512,965) 3,315,893
Interest received 1,148,007 3,700,599
Dividends received 695 19,235
-------------- -------------------
Net cash used in investing activities (218,822,321) (106,183,744)
-------------- -------------------
C. Cash flows from financing activities
Proceeds from issue of shares - 6,349,550
Payment of share issue expenses - (110,772)
Acquisition of non-controlling interest - (2,172,959)
Proceeds from non controlling interests (net of costs) 112,702,470 17,937,927
Proceeds from borrowings 157,502,004 88,494,144
Repayment of borrowings (25,397,112) (21,165,668)
Interest paid (31,939,917) (27,175,599)
Net cash from financing activities 212,867,445 62,156,623
-------------- -------------------
Net increase/(decrease) in cash and cash equivalents 24,309,617 (22,694,275)
Cash and cash equivalents at the beginning of the year 14 23,921,007 48,513,270
Exchange losses on cash and cash equivalents (15,975,718) (1,897,988)
-------------- -------------------
Cash and cash equivalents at the end of the year 14 32,254,906 23,921,007
-------------- -------------------
The notes are an integral part of these consolidated financial
statements
Notes to the consolidated financial statements
1. General information
Greenko Group plc ("the Company" or "the Parent") is a company
domiciled in the Isle of Man and registered as a company limited by
shares under company number 001805V pursuant to the provisions of
Part XI of the Isle of Man Companies Act 2006. The registered
office of the Company is at 4(th) floor, 14 Athol Street, Douglas,
Isle of Man, IM1 1JA. The Company is listed on the Alternative
Investment Market ("AIM") of the London Stock Exchange.
The Company together with its subsidiaries ("the Group") is in
the business of owning and operating clean energy facilities in
India. All the energy generated from these plants is sold to state
utilities and other electricity transmission and trading companies
in India through long-term power purchase agreements ("PPA"). The
Group holds licence to trade up to 100 million units of electricity
per annum in the whole of India except the state of Jammu and
Kashmir. However, the Group is yet to commence trading in
electricity. The Group is also a part of the Clean Development
Mechanism ("CDM") process and generates and sells Certified
Emission Reductions ("CER"), Voluntary Emission Reductions ("VER")
and Renewable Energy Certificates ("REC").
2. Summary of significant accounting policies
The principal accounting policies applied in the preparation of
these consolidated financial statements are set out below. These
policies have been consistently applied to all the periods
presented except as stated in note 3.
2.1 Basis of preparation
The consolidated financial statements of the Group have been
prepared in accordance with the International Financial Reporting
Standards ("IFRS") as adopted by the European Union. The
consolidated financial statements have been prepared under the
historical cost convention, as modified by the revaluation of
available-for-sale financial assets, and financial assets and
financial liabilities (including derivative instruments) at fair
value through profit or loss.
The preparation of financial information in conformity with IFRS
requires the use of certain critical accounting estimates. It also
requires management to exercise its judgment in the process of
applying the Group's accounting policies. The areas involving a
higher degree of judgment or complexity, or areas where assumptions
and estimates are significant to the consolidated financial
information are disclosed in the critical accounting estimates and
judgments section (note 6).
2.2 Consolidation
The consolidated financial statements include the assets,
liabilities and results of the operations of the parent company and
its subsidiaries. Subsidiaries are all entities over which the
Group has the power to govern the financial and operating policies
so as to obtain economic benefits from its activities, generally
accompanying a shareholding of more than one half of the voting
rights. The Group considers the existence and effect of potential
voting rights that are presently exercisable or convertible in
determining control. Subsidiaries are consolidated from the date on
which the Group acquires effective control. Consolidation is
discontinued from the date when control over the subsidiary
ceases.
The acquisition method of accounting is used to account for the
acquisition of subsidiaries by the Group. The cost of an
acquisition is measured as the fair value of the assets given,
equity instruments issued and liabilities incurred or assumed at
the date of exchange. Identifiable assets acquired and liabilities
and contingent liabilities assumed in a business combination are
measured initially at their fair values at the acquisition date,
irrespective of the extent of any non-controlling interest. The
excess of the cost of acquisition over the fair value of the
Group's share of the identifiable net assets acquired is recorded
as goodwill. If the cost of acquisition is less than the fair value
of the net assets of the subsidiary acquired, the difference is
recognised directly in profit or loss. Acquisition related costs
are expensed as incurred.
If the business combination is achieved in stages, previously
held identifiable assets, liabilities and contingent liabilities of
the acquired entity are revalued to their fair value at the date of
acquisition, being the date at which the Group achieves control of
the acquired entity. The movement in fair value is recognized in
profit or loss.
All intra-group transactions, balances and unrealised gains on
intra-group transactions are eliminated. Unrealised losses are also
eliminated but considered an impairment indicator of the asset
transferred. Accounting policies of subsidiaries have been changed
where necessary to ensure consistency with the policies adopted by
the Group.
Non-controlling interests represent the portion of profit or
loss and net assets that is not held by the Group and are presented
separately in the consolidated statement of profit or loss and
consolidated statement of comprehensive income and within equity in
the consolidated statement of financial position, separately from
parent shareholders' equity.
Acquisitions of an additional stake or dilution of a stake
from/to non-controlling interests in the Group, without change of
control, are accounted for using the equity method, whereby, the
difference between the consideration paid or received and the book
value of the share of the net assets is recognised in 'other
reserve' within the statement of changes in equity. The Group
attributes total comprehensive income of subsidiaries between the
owners of the Parent and the non-controlling interests based on
their respective ownership interests.
2.3 Segment reporting
The Group's operations predominantly relate to generation and
sale of electricity. The chief operating decision maker evaluates
the Group's performance and allocates resources based on an
analysis of various performance indicators at operating segment
level. Accordingly, there is only a single operating segment
"generation and sale of electricity, related emission rights and
benefits".
2.4 Foreign currency translation
a) Functional and presentation currency
Items included in the financial statements in each of the
Group's entities are measured using the currency of the primary
economic environment in which the entity operates ("the functional
currency"). The consolidated financial statements are presented in
'Euro' ("EUR"), which is the Company's functional and presentation
currency. The functional currency of the Group's subsidiaries in
India is Indian Rupees ("INR").
b) Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the date of the
transaction. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at
year-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in profit or
loss.
c) Group companies
The results and financial position of all the Group entities
(none of which has the currency of a hyper-inflationary economy)
that have a functional currency different from the presentation
currency are translated into the presentation currency as
follows:
-- assets and liabilities presented for each reporting date are
translated at the closing rate at the reporting date;
-- income and expenses for each statement of profit or loss are
translated at average exchange rates (unless this average is not a
reasonable approximation of the cumulative effect of the rates
prevailing on the transaction dates, in which case income and
expenses are translated at the rate on the dates of the
transactions); and
-- resulting exchange differences are charged/ credited to other
comprehensive income and recognised in the currency translation
reserve within equity.
On disposal of a foreign operation, the cumulative amount of the
exchange differences relating to that foreign operation that are
attributable to the non-controlling interests is derecognised and
is not reclassified to profit or loss.
When a foreign operation is partially disposed of or sold,
exchange differences that were recorded as other comprehensive
income are recognised in profit or loss as part of the gain or loss
on sale.
Goodwill and fair value adjustments arising on the acquisition
of a foreign entity are treated as assets and liabilities of the
foreign entity and translated at the closing rate.
2.5 Property, plant and equipment
Property, plant and equipment is stated at historical cost less
accumulated depreciation and any impairment in value. Freehold land
is not depreciated. Historical cost includes expenditure that is
directly attributable to the acquisition of the items and borrowing
cost. Subsequent costs are included in the asset's carrying amount
or recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with them will
flow to the Group and the cost of the item can be measured
reliably. All other repairs and maintenance expenditure are charged
to profit or loss during the period in which they are incurred.
Depreciation is calculated on a straight-line basis over the
estimated useful life of the asset as follows:
Asset category Useful life
---------------------------------- --------------
Buildings 30 - 35 years
Plant and machinery 20 - 35 years
Furniture, fixtures and equipment 15 - 20 years
Vehicles 10 years
---------------------------------- --------------
An item of property, plant and equipment is derecognised upon
disposal or when no future economic benefit is expected to arise
from the continued use of the asset. Any gain or loss arising on
de-recognition of the asset (calculated as the difference between
the net disposal proceeds and the carrying amount of the item) is
recognised in profit or loss in the period the item is
derecognised.
2.6 Intangible assets
a) Goodwill
Goodwill represents the future economic benefits arising from a
business combination that are not individually identified and
separately recognised. Goodwill represents the excess of the cost
of an acquisition over the fair value of the Group's share of the
net identifiable assets of the acquired subsidiary at the date of
acquisition. Goodwill on acquisition of subsidiaries is included in
intangible assets. Goodwill is tested annually for impairment and
carried at cost less accumulated impairment losses. Impairment
losses on goodwill are not reversed. Gains and losses on the
disposal of an entity include the carrying amount of goodwill
relating to the entity sold. Goodwill is allocated to
cash-generating units for the purpose of impairment testing. The
allocation is made to those cash-generating units or groups of
cash-generating units that are expected to benefit from the
business combination in which the goodwill arose.
b) Other intangibles
Intangible assets acquired individually, with a group of other
assets or in a business combination are carried at cost less
accumulated amortization and any impairment in value. The
intangible assets are amortised over their estimated useful lives
in proportion to the economic benefits consumed in each period. The
estimated useful lives of the intangible assets are as follows:
Asset category Useful life
-------------------------- --------------
Licences 20 - 40 years
Power purchase agreements 4 - 10 years
-------------------------- --------------
Amortisation of intangible assets is included within
'Depreciation, amortization and impairment'.
2.7 Impairment of non-financial assets
Assets that have an indefinite useful life, for example
goodwill, are not subject to amortization and are tested annually
for impairment. Assets that are subject to amortization are
reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An
impairment loss is recognised for the amount by which the asset's
carrying amount exceeds its recoverable amount. The recoverable
amount is the higher of an asset's fair value less costs to sell
and value in use. For the purposes of assessing impairment, assets
are grouped at the lowest levels for which there are separately
identifiable cash flows (cash-generating units). Non-financial
assets other than goodwill that suffered impairment are reviewed
for possible reversal of the impairment at each reporting date.
2.8 Financial assets
The Group classifies its financial assets in the following
categories: loans and receivables, financial assets at fair value
through profit and loss (FVTPL) and available for sale. The
classification depends on the purpose for which the financial asset
was acquired. Management determines the classification of its
financial assets at initial recognition.
a) Loans and receivables
Loans and receivables are non-derivative financial assets with
fixed or determinable payments that are not quoted in an active
market. They are included in current assets, except for maturities
greater than 12 months after the reporting date. These are
classified as non-current assets. The Group's loans and receivables
comprise trade and other receivables, investment in bank deposits
and cash and cash equivalents in the statement of financial
position (notes 2.11, 2.12 and 2.13). Loans and receivables are
initially recognised at fair value plus transaction costs. Loans
and receivables are carried at amortised cost using the effective
interest method.
b) Financial assets at FVTPL
Financial assets at FVTPL include financial assets that are
either classified as held for trading or that meet certain
conditions and are designated at FVTPL upon initial recognition.
All derivative financial instruments fall into this category.
Assets in this category are measured at fair value with gains or
losses recognised in profit or loss. The fair values of financial
assets in this category are determined by reference to active
market transactions or using a valuation technique where no active
market exists.
c) Available-for-sale financial assets
Available-for-sale financial assets are non-derivatives that are
either designated in this category or not classified in any of the
other categories. They are included in non-current assets unless
management intends to dispose of the investment within 12 months of
the reporting date.
Changes in the fair value of monetary and non-monetary
securities classified as available-for-sale are recognised in other
comprehensive income. When securities classified as
available-for-sale are sold or impaired, the accumulated fair value
adjustments recognised as other comprehensive income are included
in the profit or loss as 'gains and losses from investment
securities'. Dividends on available-for-sale mutual fund units are
recognised in the profit or loss as a part of other income.
Regular purchases and sales of financial assets are recognised
on the trade-date - the date on which the Group commits to purchase
or sell the asset. Investments are initially recognised at fair
value plus transaction costs for all financial assets not carried
at fair value through profit or loss. Financial assets are
derecognised when the rights to receive cash flows from the
investments have expired or have been transferred and the Group has
transferred substantially all risks and rewards of ownership.
Available-for-sale financial assets are subsequently carried at
fair value.
The fair value of the mutual fund units is based on the net
asset value publicly made available by the respective mutual fund
managers.
The Group assesses at each reporting date whether there is
objective evidence that a financial asset or a group of financial
assets is impaired. Impairment testing of trade receivables is
described in note 2.11.
The Group derecognises financial assets when it transfers
substantially all the risks and rewards of ownership of the
financial asset. On de-recognition of a financial asset the
difference between the carrying amount and the consideration
received is recognised in profit or loss.
2.9 Options with non-controlling interests in subsidiaries
The Group has entered into put and call options over certain
non-controlling interests in subsidiaries. The option exercise
price is fixed and the options are exercisable within a fixed
timeframe. The potential cash payments related to options issued by
the Group over the equity of subsidiary companies are accounted for
as financial liabilities at the present value of the redemption
amount in line with the requirements of IAS 32 and 39. The amount
that may become payable under the option on exercise is initially
recognised at fair value with a corresponding debit to 'Option
Reserve' under equity. Such financial liabilities are subsequently
measured at amortized cost, using the effective interest rate
method.
2.10 Inventories
a) Raw material, stores and consumables
Inventories of raw material, stores and consumables are valued
at the lower of cost and net realisable value. Cost includes
expenses incurred in bringing each product to its present location
and condition and is determined on a weighted average basis. Net
realisable value is the estimated selling price in the ordinary
course of business less any applicable selling expenses.
b) Emission Reductions ("ER") and Renewable Energy Certificates ("REC")
Inventories of ER and REC are stated at the lower of cost or net
realisable value. Net realisable value is the estimated selling
price in the ordinary course of business less the estimated costs
of completion and selling expenses. ER are generated and held for
sale in the ordinary course of business. Electricity and ERs/RECs
are treated as joint products, as they are generated
simultaneously. Cost of generation is allocated in the ratio of
relative net sale value of the products. Cost comprises all
production, acquisition and conversion costs and is aggregated on a
weighted average basis. To the extent that any impairment arises,
losses are recognised in the period they occur. The costs
associated with generating inventories are charged to the profit or
loss in the same period as the related revenues are recognised.
2.11 Trade and other receivables
Trade receivables are recognized initially at fair value plus
transaction costs. They are subsequently measured at amortised cost
using the effective interest method, net of provision for
impairment, if the effect of discounting is considered material.
The carrying amounts, net of provision for impairment, reported in
the statement of financial position approximate the fair value due
to their short realisation period. A provision for impairment of
trade receivables is established when there is objective evidence
that the Group will not be able to collect all amounts due
according to the original terms of receivables. The provision is
measured as the difference between the asset's carrying amount and
the present value of estimated future cash flows (excluding future
credit losses that have not been incurred) discounted at the
receivables' original effective interest rate. The amount of the
provision is recognized in the profit or loss.
2.12 Investment in bank deposits
Investments in bank deposits represent term deposits placed with
banks earning a fixed rate of interest. Investments in bank
deposits with maturities of less than a year are disclosed as
current assets and more than one year as non-current assets. At the
reporting date, these deposits are measured at amortised cost using
the effective interest method. Cash and cash equivalents which are
pledged with the banks for availing short-term loans are classified
as part of investment in bank deposits.
2.13 Cash and cash equivalents
Cash and cash equivalents include cash in hand and at bank, and
short-term deposits with an original maturity period of three
months or less. Bank overdrafts that are an integral part of cash
management and where there is a legal right of set-off against
positive cash balances are included in cash and cash equivalents.
Otherwise bank overdrafts are classified as borrowings.
2.14 Assets and liabilities classified as held for sale
Non-current assets/liabilities (or disposal groups) are
classified as 'assets held for sale' when their carrying amount is
to be recovered principally through a sale transaction and a sale
is considered highly probable. Assets and liabilities are stated at
the lower of carrying amount and fair value less costs to sell.
However, some 'held for sale assets' such as financial assets or
deferred tax assets, continue to be measured in accordance with the
Group's relevant accounting policies for those assets. Once
classified as 'held for sale', the assets are not subject to
depreciation or amortisation.
2.15 Share capital
Ordinary shares are classified as equity and represent the
nominal value of shares that have been issued.
Share premium includes any premiums received on the issue of
ordinary shares. Any transaction costs associated with the issuing
of shares are deducted from share premium, net of any related
income tax benefits.
Share-based payment reserve represent fair value of employee
services received in consideration for the equity instruments
(options) of the Group.
The revaluation reserve within equity comprises gains and losses
due to the revaluation of intangible assets.
Foreign currency translation differences arising on the
translation of the Group's foreign entities are included in the
translation reserve.
Other reserves include all other transaction with the owners in
their capacity as owners, impact of changes in the ownership
interest in subsidiaries that do not result in loss of control and
government grants accounted under capital approach.
Option reserve represents fair value of non-controlling
interests put on initial recognition.
Retained earnings include all current and prior period retained
profits.
All transactions with owners of the Parent are recorded
separately within equity.
2.16 Trade payables
Trade payables are recognised initially at fair value and
subsequently measured at amortised cost using the effective
interest method, if the effect of discounting is considered
material.
2.17 Borrowings
Borrowings are recognised initially at fair value, net of
transaction costs incurred. Borrowings are subsequently stated at
amortised cost; any difference between the proceeds (net of
transaction costs) and the redemption value is recognised in profit
or loss over the period of the borrowings using the effective
interest method.
The fair value of the liability portion of a non-convertible
bond with detachable warrants is determined using a market interest
rate for an equivalent non-convertible bond without detachable
warrants. This amount is recorded as a liability on an amortised
cost basis until extinguished on maturity of the bonds. The
remainder of the proceeds is allocated to the warrants. This is
recognised in shareholders' equity.
Borrowings are classified as current liabilities unless the
Group has an unconditional right to defer settlement of the
liability for at least 12 months after the reporting date.
2.18 Current and deferred income tax
Tax expense recognised in profit or loss comprises the sum of
deferred tax and current tax not recognised in other comprehensive
income or directly in equity.
The current income tax charge is calculated on the basis of the
tax laws enacted or substantively enacted at the reporting date in
the countries where the Company's subsidiaries operate and generate
taxable income. Management periodically evaluates positions taken
in tax returns with respect to situations in which applicable tax
regulations are subject to interpretation and establishes
provisions where appropriate on the basis of amounts expected to be
paid to the tax authorities.
Deferred income tax is provided in full, using the liability
method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the
consolidated financial statements. However, the deferred income tax
is not accounted for if it arises from initial recognition of an
asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither
accounting nor taxable profit/loss. Deferred income tax is
determined using tax rates (and laws) that have been enacted or
substantively enacted by the reporting date and are expected to
apply when the related deferred income tax asset is realised or the
deferred income tax liability is settled.
Deferred income tax assets are recognised to the extent that it
is probable that future taxable profit will be available against
which the temporary differences can be utilised.
Deferred income tax is provided on temporary differences arising
on investments in subsidiaries, except where the timing of the
reversal of the temporary difference is controlled by the Group and
it is probable that the temporary difference will not reverse in
the foreseeable future.
2.19 Employee benefits
Wages, salaries, bonuses, social security contributions, paid
annual leave and sick leave are accrued in the period in which the
associated services are rendered by employees of the Group. The
Group operates two retirement benefit plans.
a) Gratuity plan
The Gratuity Plan is a defined benefit plan that, at retirement
or termination of employment, provides eligible employees with a
lump sum payment, which is a function of the last drawn salary and
completed years of service. The liability recognised in the
statement of financial position in respect of the gratuity plan is
the present value of the defined benefit obligation at the
reporting date less the fair value of plan assets. The defined
benefit obligation is calculated annually by independent actuaries
using the projected unit credit method. The present value of the
defined benefit obligation is determined by discounting the
estimated future cash outflows using interest rates of Government
of India securities that have terms to maturity approximating to
the terms of the related gratuity liability.
Service cost on the net defined benefit liability is included in
employee benefits expense. Net interest expense on the net defined
benefit liability is included in finance costs.
b) State administered Provident Fund
Under Indian law, employees are entitled to receive benefits
under the Provident Fund, which is a defined contribution plan.
Both the employee and the employer make monthly contributions to
the plan at a predetermined rate (currently 12.0 per cent.) of the
employees' basic salary. The Group has no further obligation under
the Provident Fund beyond its contribution, which is expensed when
accrued.
c) Share-based compensation
The Group operates an equity-settled, share-based compensation
plan, under which the entity receives services from employees as
consideration for equity instruments (options) of the Group. The
fair value of the employee services received in exchange for the
grant of the options is recognised as an expense. The total amount
to be expensed is determined by reference to the fair value of the
options granted, including the impact of market conditions.
Non-market vesting conditions are included in assumptions about the
number of options that are expected to vest. The total amount
expensed is recognised on a graded vesting basis over the vesting
period, which is the period over which all of the specified vesting
conditions are to be satisfied. At each reporting date, the entity
revises its estimates of the number of options that are expected to
vest based on the non-market vesting conditions. It recognises the
impact of the revision to original estimates, if any, in profit or
loss, with a corresponding adjustment to equity. If the terms of an
equity-settled award are modified, at a minimum an expense is
recognised as if the terms had not been modified. An additional
expense is recognised for any modification that increases the total
fair value of the share-based payment arrangement, or is otherwise
beneficial to the employee, as measured at the date of
modification.
The proceeds received net of any directly attributable
transaction costs are credited to share capital (nominal value) and
share premium when the options are exercised.
2.20 Provisions
Provisions are recognised when the Group has a present
obligation (legal or constructive) as a result of a past event, it
is probable that an outflow of resources embodying economic
benefits will be required to settle the obligation, and a reliable
estimate can be made of the amount of the obligation. Where the
Group expects some or all of a provision to be reimbursed, for
example under an insurance contract, the reimbursement is
recognised as a separate asset but only when the reimbursement is
virtually certain. The expense relating to any provision is
presented in the statement of profit or loss net of any
reimbursement. If the effect of the time value of money is
material, provisions are determined by discounting the expected
future cash flows at a pre-tax rate that reflects current market
assessments of the time value of money and, where appropriate, the
risks specific to the liability. Where discounting is used, the
increase in the provision due to the passage of time is recognised
as other finance expense.
2.21 Revenue recognition
a) Sale of electricity
Revenue from the sale of electricity is recognised on the basis
of the number of units of power exported in accordance with joint
meter readings undertaken on a monthly basis by representatives of
the buyer and the Group at the rates prevailing on the date of
export as determined by the power purchase agreement/feed-in-tariff
policy as applicable. Claims for delayed payment charges and other
claims, if any, are recognised as per the terms of power purchase
agreements.
b) Sale of emission reductions
Revenue from sale of CER is recognized after registration of the
project with United Nations Framework Convention on Climate Change
(UNFCCC), generation of emission reductions, execution of a firm
contract of sale and billing to a customer.
VER are emission reductions achieved by the power generation
plants before the effective date of registration by the UNFCCC. The
quantity of the VER is based on the estimation of the management,
verification by an independent assessor and subject to the
satisfaction of the buyer. Revenue is recognized upon execution of
a firm contract of sale and on billed VER to the customers.
c) Sale of REC
Revenue from sale of RECs is recognized after registration of
the project with central and state government authorities,
generation of power and execution of a contract for sale through
recognised energy exchanges in India.
d) Generation Based Incentive (GBI)
Revenue from GBI is recognized based on the number of units
exported or if the eligibility criteria is met in accordance with
the guidelines issued by regulatory authority for GBI Scheme.
e) Interest income
Interest income is recognised as the interest accrues to the net
carrying amount of the financial asset using the net effective
interest rate method.
2.22 Leases
Leases in which a significant portion of the risks and rewards
of ownership are retained by the lessor are classified as operating
leases. Payments made under operating leases (net of any incentives
received from the lessor) are charged to the profit or loss on a
straight-line basis over the period of the lease.
2.23 Government grants
Grants from the government are recognised at their fair value
where there is a reasonable assurance that the grant will be
received and the Group will comply with all attached conditions.
The Group follows the capital approach under which a grant is
credited directly to equity when the grants received by the Group
represent incentives provided by government, unrelated to costs, to
promote power generation based on certain renewable energy
sources.
Other government grants are recognised as income over the period
necessary to match them with the costs for which they are intended
to compensate, on a systematic basis. Government grants that are
receivable as compensation for expenses or losses already incurred
or for the purpose of giving immediate financial support to the
Company with no future related costs are recognised in profit or
loss in the period in which they become receivable.
2.24 Borrowing costs
Borrowing costs directly attributable to the acquisition,
construction or production of a qualifying asset are capitalised
during the period of time that is necessary to complete and prepare
the asset for its intended use or sale. Other borrowing costs are
expensed in the period in which they are incurred and reported in
finance costs.
3. Change in accounting policies
A number of new and revised standards are effective for annual
periods beginning on or after 1 January 2013. Information on these
new standards is presented below.
Presentation of statement of comprehensive income
During the year, the presentation has changed from a single
statement with profit or loss and other comprehensive income
presented in two sections viz. a separate Statement of Profit or
Loss and a separate Statement of Comprehensive Income.
IFRS 13 'Fair Value Measurement' (IFRS 13)
IFRS 13 clarifies the definition of fair value and provides
related guidance and enhanced disclosures about fair value
measurements. It does not affect which items are required to be
fair-valued. The scope of IFRS 13 is broad and it applies for both
financial and non-financial items for which other IFRSs require or
permit fair value measurements or disclosures about fair value
measurements except in certain circumstances.
IFRS 13 applies prospectively for annual periods beginning on or
after 1 January 2013. Its disclosure requirements need not be
applied to comparative information in the first year of
application. The Group has however included as comparative
information the IFRS 13 disclosures that were required previously
by IFRS 7 'Financial Instruments: Disclosures'.
The Group has applied IFRS 13 for the first time in the current
year, see note 10.
Amendment to IAS 1, 'Financial statement presentation'
The main change resulting from these amendments is a requirement
for entities to group items presented in 'other comprehensive
income' (OCI) on the basis of whether they are potentially
reclassifiable to profit or loss subsequently (reclassification
adjustments).
Amendments to IAS 19 'Employee Benefits' (IAS 19)
The 2011 amendments to IAS 19 made a number of changes to the
accounting for employee benefits, the most significant relating to
defined benefit plans. The amendments:
-- eliminate the 'corridor method' and requires the recognition
of re-measurements (including actuarial gains and losses) arising
in the reporting period in other comprehensive income
-- change the measurement and presentation of certain components
of the defined benefit cost. The net amount in profit or loss is
affected by the removal of the expected return on plan assets and
interest cost components and their replacement by a net interest
expense or income based on the net defined benefit asset or
liability
-- enhance disclosures, including more information about the
characteristics of defined benefit plans and related risks.
The application of IAS 19 did not have a material impact on the
financial position, performance, cash flows and on the earnings per
share for the year ended 31 March 2013 and 31 March 2014.
4. New standards and interpretations not yet adopted
At the date of authorisation of these financial statements,
certain new standards, amendments and interpretations to existing
standards have been published by the IASB but are not yet
effective, and have not been adopted early by the Group.
Management anticipates that all of the relevant pronouncements
will be adopted in the Group's accounting policies for the first
period beginning after the effective date of the pronouncement.
Information on new standards, amendments and interpretations that
are expected to be relevant to the Group's financial statements is
provided below. Certain other new standards and interpretations
have been issued but are not expected to have a material impact on
the Group's financial statements.
Consolidation Standards
A package of new consolidation standards is effective for annual
periods beginning or after 1 January 2014. Information on these new
standards is presented below. Management is in the process of its
assessment of the impact of these new and revised standards on the
Group's consolidated financial statements.
IFRS 10 'Consolidated Financial Statements' (IFRS 10)
IFRS 10 supersedes IAS 27 'Consolidated and Separate Financial
Statements' (IAS 27) and SIC 12 'Consolidation - Special Purpose
Entities'. IFRS 10 revises the definition of control and provides
extensive new guidance on its application. These new requirements
have the potential to affect which of the Group's investees are
considered to be subsidiaries and therefore change the scope of
consolidation. However, the requirements on consolidation
procedures, accounting for changes in non-controlling interests and
accounting for loss of control of a subsidiary remain the same.
Management's provisional analysis is that IFRS 10 will not change
the classification (as subsidiaries or otherwise) of any of the
Group's existing investees at 31 March 2014.
IFRS 11 'Joint Arrangements' (IFRS 11)
IFRS 11 supersedes IAS 31 'Interests in Joint Ventures' (IAS
31). It aligns more closely the accounting by the investors with
their rights and obligations relating to the joint arrangement. In
addition, IAS 31's option of using proportionate consolidation for
joint ventures has been eliminated. IFRS 11 now requires the use of
the equity accounting method, which is currently used for
investments in associates. As at 31 March 2014 the Group's does not
have any joint arrangement within the scope of IFRS 11.
IFRS 12 'Disclosure of Interests in Other Entities' (IFRS
12)
IFRS 12 integrates and makes consistent the disclosure
requirements for various types of investments, including
unconsolidated structured entities. It introduces new disclosure
requirements about the risks to which an entity is exposed from its
involvement with structured entities.
Transition guidance for IFRS 10, 11, 12
Subsequent to issuing the new standards the IASB made some
changes to the transitional provisions in IFRS 10, IFRS 11 and IFRS
12. The guidance confirms that the entity is not required to apply
IFRS 10 retrospectively in certain circumstances and clarifies the
requirements to present adjusted comparatives. The guidance also
makes changes to IFRS 11 and IFRS 12 which provide similar relief
from the presentation or adjustment of comparative information for
periods prior to the immediately preceding period. Further, it
provides additional relief by removing the requirement to present
comparatives for the disclosures relating to unconsolidated
structured entities for any period before the first annual period
for which IFRS 12 is applied.
The new guidance is also effective for annual periods on or
after 1 January 2014.
IAS 32 Offsetting Financial Assets and Financial Liabilities -
Amendments to IAS 32
These amendments clarify the meaning of "currently has a legally
enforceable right to set-off" and the criteria for non-simultaneous
settlement mechanisms of clearing houses to qualify for offsetting.
These are effective for annual periods beginning on or after 1
January 2014. These amendments are not expected to be relevant to
the Group.
Consequential amendments to IAS 27 'Separate Financial
Statements' (IAS 27) and IAS 28 'Investments in Associates and
Joint Ventures' (IAS 28)
IAS 27 now only addresses separate financial statements. IAS 28
brings investments in joint ventures into its scope. However, IAS
28's equity accounting methodology remains unchanged.
Investment Entities - Amendments to IFRS 10, IFRS 12 and IAS
27
The Amendments define the term 'investment entity', provide
supporting guidance and require investment entities to measure
investments in the form of controlling interests in another entity
at fair value through profit or loss.
Management does not anticipate a material impact on the Group's
consolidated financial statements.
5. Financial risk management
5.1. Financial risk factors
The Group's activities expose it to a variety of financial
risks; market risk, credit risk and liquidity risk. The Group's
overall risk management programme focuses on the unpredictability
of financial markets and seeks to minimise potential adverse
effects on the Group's financial performance. The financial
instruments of the Group, other than derivatives, comprise loans
from banks and financial institutions, non-convertible bonds,
demand deposits, short-term bank deposits, trade and other
receivables, available for sale investments, trade and other
payables.
5.1.1 Market risk
Market risk is the risk that the fair values of future cash
flows of a financial instrument will fluctuate because of
volatility of prices in the financial markets. Market risk can be
further segregated as: a) Foreign exchange risk and b) Interest
rate risk
a) Foreign exchange risk
Foreign exchange risk is the risk that the fair value or future
cash flows of a financial instrument will fluctuate because of
changes in foreign exchange rates. The Group has made borrowings
denominated in US dollar ("$") in respect of which it is exposed to
foreign currency exchange risk.
If the EUR had weakened or strengthened by 0.50% against the $,
with all other variables held constant, Property, plant and
equipment for the year ended 31 March 2014 would have been lower or
higher by EUR254,485 as a result of foreign exchange gains or
losses on translation of the $ denominated borrowings.
The sensitivity analysis is based on a reasonably possible
change in the underlying foreign currencies computed from
historical data.
b) Interest rate risk
Interest rate risk is the risk that the fair value or future
cash flows of a financial instrument will fluctuate because of
changes in market interest rates. As the Group has no significant
interest-bearing assets other than investment in bank deposits, the
Group's income and operating cash flows are substantially
independent of changes in market interest rates. The Company
considers the impact of fair value interest rate risk on investment
in bank deposits as not material. The Group's interest rate risk
arises from long-term borrowings. Borrowings issued at variable
rates expose the Group to cash flow interest rate risk. Borrowings
issued at fixed rates expose the Group to fair value interest rate
risk. During the year, the Group's borrowings at variable rate were
largely denominated in the functional currency of its Indian
entities, being INR, although two loans were denominated in $.
If interest rates on borrowings had been 50 basis points higher
or lower with all other variables held constant, post-tax profit
for the year would have been lower or higher by EUR861,011 mainly
as a result of the higher or lower interest expense on long term
floating rate borrowings.
The sensitivity analysis is based on a reasonably possible
change in the market interest rates computed from historical
data.
5.1.2 Credit risk
Credit risk is the risk that a counter-party will not meet its
obligations under a financial instrument or customer contract,
leading to a financial loss. The Group's credit risk arises from
accounts receivable balances on sale of electricity, CER and REC.
In respect of trade and other receivables, the Group is not exposed
to any significant credit risk exposure to any single counterparty
or any group of counterparties having similar characteristics. The
Indian entities have entered into PPA with transmission companies
incorporated by the Indian State Governments and other electricity
transmission and trading companies to export the electricity
generated. The Group is therefore committed to sell power to these
customers and regards any potential risk of default as being
predominantly a governmental one. The Group is paid monthly by the
transmission companies for the electricity it supplies. The CER are
sold under contractual emission reduction purchase agreements
concluded with the purchaser of the CER. The Group assesses the
credit quality of the purchaser based on its financial position and
other information.
The Group maintains banking relationships with only creditworthy
banks which it reviews on an on-going basis. The Group enters into
derivative financial instruments where the counter-party is
generally a bank. Consequently, the credit risk on the derivatives
and bank deposits is not considered material.
5.1.3 Liquidity risk
Prudent liquidity risk management implies maintaining sufficient
cash and cash equivalents and maintaining adequate credit
facilities.
The Group intends to be acquisitive in the immediate future. In
respect of its existing operations, the Group funds its activities
primarily through long-term loans secured against each power plant.
In addition, each of the operating plants has working capital loans
available to it which are renewable annually, together with certain
intra-group loans. The Group's objective in relation to its
existing operating business is to maintain sufficient funding to
allow the plants to operate at an optimal level and in particular
purchase the necessary raw materials required.
In respect of each acquisition, the Group prepares a model to
evaluate the necessary funding required. The Group's strategy is to
primarily fund such acquisitions by assuming debt in the acquired
companies or by borrowing specific long-term funds secured on the
power plant to be acquired. In relation to the payment towards
equity component of companies to be acquired, the Group ordinarily
seeks to fund this by the injection of external funds by debt or
equity.
The Group has identified a large range of acquisition
opportunities which it is continually evaluating and which are
subject to constant change. In respect of its overall business the
Group therefore does not, at the current time, maintain any overall
liquidity forecasts. The table below analyses the Group's financial
liabilities into relevant maturity groupings based on the remaining
period at the reporting date to the contractual maturity date. The
Group manages its liquidity needs by monitoring scheduled debt
servicing payments for long-term financial liabilities and the data
used for analysing these cash flows is consistent with that used in
the contractual maturity analysis below.
The amounts disclosed in the table are the contractual
undiscounted cash flows.
Less than Between 1 Between 2 Over
At 31 March 2014 1 year and 2 years and 5 years 5 years
------------------ ------------- ------------- ------------
Borrowings 73,163,342 22,762,121 91,097,303 170,126,081
Other financial liabilities 71,654,632
Trade and other payables 33,090,345 2,498,844
Other liabilities 2,484,638
------------------ ------------- ------------- ------------
Total 108,738,325 25,260,965 162,751,935 170,126,081
------------------ ------------- ------------- ------------
Less than Between 1 Between 2 Over
At 31 March 2013 1 year and 2 years and 5 years 5 years
------------------ ------------- ------------- ------------
Borrowings 19,334,846 74,091,308 74,024,731 87,288,027
Other financial liabilities - - 79,735,708 -
Trade and other payables 30,201,891 - 2,064,903 -
Other liabilities 135,205 - - -
------------------ ------------- ------------- ------------
Total 49,671,942 74,091,308 155,825,342 87,288,027
------------------ ------------- ------------- ------------
5.1.4 Capital risk management
The Group's objective when managing capital is to safeguard the
Group's ability to continue as a going concern in order to provide
returns for shareholders and benefits for stakeholders. The Group
also proposes to maintain an optimal capital structure to reduce
the cost of capital. Hence, the Group may adjust any dividend
payments, return capital to shareholders or issue new shares. Total
capital is the equity as shown in the consolidated statement of
financial position. Currently, the Group primarily monitors its
capital structure in terms of evaluating the funding of potential
acquisitions. Management is continuously evolving strategies to
optimize the returns and reduce the risks. It includes plans to
optimize the financial leverage of the Group.
The capital for the reporting year under review is summarised as
follows:
31 March 31 March
2014 2013
------------------ ------------------
Total equity 330,087,109 266,476,162
Less: Cash and cash equivalents (32,254,906) (23,921,007)
------------------ ------------------
Capital 297,832,203 242,555,155
Total equity 330,087,109 266,476,162
Add: Borrowings 350,310,164 247,863,208
Overall financing 680,397,273 514,339,370
------------------ ------------------
Capital to overall financing ratio 44% 47%
5.1.5 Fair value estimation
The fair value of financial instruments that are not traded in
an active market (for example, forward contracts) is determined by
using valuation techniques. The Group uses its judgment to
determine an appropriate method and make assumptions that are based
on market conditions existing at each reporting date. The fair
value of forward foreign exchange contracts is determined using
quoted forward exchange rates at the reporting date.
The carrying value less impairment provision of trade
receivables and payables are assumed to approximate their fair
values due to the short-term nature. The fair value of financial
liabilities for disclosure purposes is estimated by discounting the
future contractual cash flows at the current market interest rate
that is available to the Group for similar financial
instruments.
6. Critical accounting estimates and judgements
The preparation of financial statements requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities, disclosure of contingent assets and
liabilities at the date of the financial information and the
reported amounts of revenue and expenses during the reporting
period. Management bases its estimates and judgments on historical
experience and on various other factors that are believed to be
reasonable under the circumstances, the results of which form the
basis for making judgments about the carrying value of assets and
liabilities that are not readily available from other sources.
The Group makes estimates and assumptions concerning the future.
The resulting accounting estimates will, by definition, seldom
equal the related actual results. The estimates and assumptions
that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next
financial year are discussed below.
a) Income taxes
The Group is subject to income taxes in a number of
jurisdictions. Significant judgment is required in determining
provision for income taxes. There are many transactions and
calculations for which the ultimate tax determination is uncertain
during the ordinary course of business. The Group recognises
liabilities for anticipated tax issues based on estimates of
whether additional taxes will be due. Where the final tax outcome
of these matters is different from the amounts that were initially
recorded, such differences will impact the income tax and deferred
tax provisions in the period in which such determination is
made.
b) Estimated impairment of goodwill
In accordance with the accounting policy stated in note 2.6, the
Group tests annually whether goodwill has suffered any impairment.
The recoverable amounts of cash-generating units have been
determined based on value-in-use calculations. These calculations
require the use of estimates including future operating margins and
discount rates (note 8).
c) Application of business combination accounting rules,
including identification and valuation of intangible assets
acquired in a business combination
The Group allocates the purchase price of the acquired companies
towards the tangible and intangible assets acquired and liabilities
assumed based on their estimated fair values. The Group engages
third-party external appraisal firms to assist in determining the
fair values of the acquired assets and liabilities. Such valuation
requires the Group to make significant estimate and assumptions,
especially with respect to identification and valuation of
intangible assets.
d) Useful life of depreciable assets
Management reviews the useful life of depreciable assets at each
reporting date, based on the expected utility of the assets to the
Group. The carrying amounts are analysed in note 9. Actual results,
however, may vary due to technical obsolescence, particularly
relating to software and IT equipment.
e) Application of lease accounting rules
Significant judgment is required to apply lease accounting rules
under IFRIC 4 Determining whether an Arrangement contains a Lease
and IAS 17 Leases. In assessing the applicability to arrangements
entered into by the Group management has exercised judgment to
evaluate customer's right to use the underlying assets, substance
of the transaction including legally enforced arrangements and
other significant terms and conditions of the arrangement to
conclude whether the arrangements meet the criteria under IFRIC
4.
f) Application of interpretation for service concession arrangements
Management has assessed applicability of IFRIC 12: Service
Concession Arrangements for certain arrangements that are part of
business combinations acquired during the year. In assessing the
applicability the management has exercised significant judgement in
relation to the underlying ownership of the assets, the ability to
enter into power purchase arrangements with any customer, ability
to determine prices etc in concluding that the arrangements don't
meet the criteria for recognition as service concession
arrangements.
g) Classification of financial instruments as equity or liability
Significant judgment is required to apply the rules under IAS
32: Financial Instruments: Presentation and IAS 39: Financial
Instruments: Recognition and Measurement to assess whether an
instrument is equity or a financial liability. The management has
exercised significant judgment to evaluate the terms and conditions
of certain financial instruments with reference to the
applicability of contingent settlement provisions, evaluation of
whether options under the contract will be derivative or a
non-derivative, assessing if certain settlement terms are within
the control of the Company and if not whether the occurrence of
these events are extremely rare, highly abnormal and very unlikely,
clarifications between the parties to the agreement subsequent to
the date of the agreement etc to conclude that the instruments be
classified as an equity or liability instrument.
h) Classification and measurement of disposal group held for sale
The Group has classified certain assets as disposal group held
for sale. Significant judgment is required to apply the principles
relating classification and measurement of disposal group as laid
under IFRS 5 'Non-current Assets Held for Sale and Discontinued
Operations'.
7. Interest in subsidiaries
Set out below are the Group's subsidiaries at 31 March 2014.
Unless otherwise stated, the subsidiaries as listed below have
share capital consisting solely of ordinary shares, which are held
directly by the Group and the proportion of ownership interests
held equals to the voting rights held by Group. The country of
incorporation or registration is also their principal place of
business.
Holding Holding
as at as at
Country 31 March 31 March
of incorporation 2014 2013
------------------- ---------- --------------------
Greenko Mauritius#@ Mauritius 68.53% 82.94%
Greenko HP Mauritius 100% 100%
Black Hawk Corporation Mauritius 100% 100%
Glory Corporation Limited Mauritius 100% 100%
Greenko Energies Private Limited India 100% 100%
Elger Company Limited Mauritius 100% 100%
Tanco Limited Mauritius 100% 100%
Greenko Wind Projects Private
Limited#$ (note 18.7) India 79.24% 56.60%
AMR Power Private Limited India 100% 100%
Animala Wind Power Private
Limited India 100% 100%
Anubhav Hydel Power Private
Limited India 100% 100%
Astha Projects (India) Private
Limited India 100% 100%
AT Hydro Power Private Limited India 100% 100%
Belum Wind Infrastructure Private
Limited India 100% 100%
Bharmour Hydro Projects Private
Limited* India 100% -
Cimaron Constructions Private
Limited India 100% 100%
Devgarh Wind Projects Private
Limited India 100% 100%
Ecofren Power & Projects Private
Limited India 100% 100%
Fortune Five Hydel Projects
Private Limited India 100% 100%
Greenko Bagewadi Wind Energies
Private Limited India 100% -
Greenko Energy Ventures Private
Limited India 100% -
Greenko Godavari Power Projects
Private Limited India 100% 100%
Greenko Hatkoti Energy Private
Limited* India 100% 100%
Greenko Rego Hydro Projects India 100% -
Private Limited
Greenko Solar Energy Private India 100% -
Limited
Greenko Zenith Energy Solutions
Private Limited India 100% 100%
Guttaseema Wind Energy Company
Private Limited India 100% 100%
Harsar Hydro Projects Private
Limited* India 100% -
Hemavathy Power & Light Private
Limited India 100% 100%
Him Kailash Hydro Power Private
Limited India 100% 100%
ISA Power Private Limited India 100% 100%
Jasper Energy Private Limited India 100% 100%
Kangtangshiri Hydro Power Private
Limited* India 100% 100%
Kanhur Wind Power Private Limited India 100% 100%
Kukke Hydel Projects Private
Limited India 100% 100%
Kumaradhara Power Private Limited India 100% 100%
LVS Power Private Limited India 100% 100%
Mangalore Energies Private
Limited* India 100% -
Matrix Power (Wind) Private
Limited India 74% -
Mechuka Hydro Power Private
Limited* India 100% 100%
Perla Hydro Power Private Limited India 100% 100%
Rangaraju Warehousing Private
Limited India 100% 100%
Rapum Hydro Power Private Limited* India 100% 100%
Ratnagiri Wind Power Projects
Private Limited India 100% 100%
Ravikiran Power Projects Private
Limited India 100% 100%
Rayala Wind Power Company Private
Limited India 100% 100%
Rayalaseema Wind Energy Company
Private Limited India 100% 100%
Rithwik Energy Generation Private
Limited India 100% 100%
Roshni Powertech Private Limited India 100% 100%
Sai Spurthi Power Private Limited India 100% 100%
Sai Teja Energies Private Limited India 100% 100%
Sneha Kinetic Power Projects
Private Limited India 99.96% 99.93%
Sobra Hydro Energy Private
Limited India 100% -
Sri Sai Krishna Hydro Energies
Private Limited India 100% 100%
Sunam Power Private Limited India 100% 100%
Tanot Wind Power Ventures Private
Limited India 100% 100%
Tarela Power Private Limited India 100% 100%
Technology House (India) Private
Limited* India 100% 100%
Tejassarnika Hydro Energies
Private Limited India 100% 100%
Vayuputhra Energy Private Limited India 100% -
Vyshali Energy Private Limited India 100% 100%
* The beneficial and economic interest of the Group is 100% due
to agreement with the other shareholders.
# Entities has preferential shares in additions to ordinary
shares.
@ Holding as at 31 March 2014 has reduced due to infusion of
fresh equity by GIC.
$ Holding as at 31 March 2014 has increased due to infusion of
further fresh equity by the Group.
8. Intangible assets
Electricity
Licences PPAs Goodwill Total
------------------ ---------------- --------------- ----------------
Cost
At 1 April 2012 57,989,338 12,397,074 13,317,877 83,704,289
Additions - - - -
Acquisition on business combination
(note: 29.2) 35,220,404 804,799 5,071,181 41,096,384
Disposals (54,363) - - (54,363)
Exchange differences (1,125,237) (227,817) (317,329) (1,670,383)
------------------ ---------------- --------------- ----------------
At 31 March 2013 92,030,142 12,974,056 18,071,729 123,075,927
Additions 432,854 - - 432,854
Acquisition on business combination
(note: 29.1) 11,937,200 - - 11,937,200
Asset classified as held for
sale (106,563) (224,025) - (330,588)
Exchange differences (15,397,089) (2,048,698) (2,853,661) (20,299,448)
------------------ ---------------- --------------- ----------------
At 31 March 2014 88,896,544 10,701,333 15,218,068 114,815,945
------------------ ---------------- --------------- ----------------
Accumulated amortization and
impairment
At 1 April 2012 739,578 3,580,904 - 4,320,482
Charge for the year 522,825 1,649,293 - 2,172,118
Disposals (1,335) - - (1,335)
Exchange differences ( 7,517) ( 49,461) - ( 56,978)
------------------ ---------------- --------------- ----------------
At 31 March 2013 1,253,551 5,180,736 - 6,434,287
Charge for the year 513,701 1,983,178 493,084 2,989,963
Asset classified as held for
sale (41,862) (188,108) - (229,970)
Exchange differences (205,084) (881,333) 11,823 (1,074,594)
------------------ ---------------- --------------- ----------------
At 31 March 2014 1,520,306 6,094,473 504,907 8,119,686
------------------ ---------------- --------------- ----------------
Net book value
At 31 March 2014 87,376,238 4,606,860 14,713,161 106,696,259
At 31 March 2013 90,776,591 7,793,320 18,071,729 116,641,640
At 1 April 2012 57,249,760 8,816,170 13,317,877 79,383,807
------------------ ---------------- --------------- ----------------
Amortization and impairment charges are included under
'Depreciation, amortization and impairment' in the statement of
profit or loss. The average remaining amortization period for
licences is 27.4 years and for electricity PPA is 3.1 years.
Impairment tests for goodwill
Goodwill acquired through business combinations have been
allocated to each individual power generation unit ("CGU"). A CGU
level summary of goodwill is presented below:
31 March Assets Exchange 31 March
2013 held difference 2014
for sale
------------- ---------- ------------ ------------
Hemavathy Power & Light Private
Limited - HLBC unit 4,005,153 - (632,444) 3,372,709
LVS Power Private Limited 2,760,908 - (435,968) 2,324,940
Hemavathy Power & Light Private
Limited - HRB unit 2,129,643 - (336,287) 1,793,356
Tejassarnika Hydro Energies
Private Limited 1,934,573 - (305,483) 1,629,090
Astha Projects (India) Private
Limited - Dehar unit 1,079,424 - (170,449) 908,975
Astha Projects (India) Private
Limited - Awa unit 970,576 - (153,261) 817,315
Cimaron Constructions Private
Limited 818,145 - (129,192) 688,953
Roshni Powertech Private Limited 731,633 - (115,531) 616,102
Tarela Power Limited 626,216 - (98,884) 527,332
Multiple units without significant
goodwill 3,015,458 (493,084) (487,985) 2,034,389
------------- ---------- ------------ ------------
18,071,729 (493,084) (2,865,484) 14,713,161
------------- ---------- ------------ ------------
The recoverable amount of a CGU is determined based on
value-in-use calculations. These calculations use pre-tax cash flow
projections prepared by management based on balance life of the
license or the plant and equipment where the license has indefinite
life. The growth rate does not exceed the long-term average growth
rate for the business in which the CGU operates. The recoverable
amount of significant CGUs is set out below:
31 March 31 March
2014 2013
----------- -----------
Hemavathy Power & Light Private Limited
- HLBC unit 13,493,217 17,817,084
LVS Power Private Limited 31,952,519 36,123,095
Hemavathy Power & Light Private Limited
- HRB unit 6,625,484 7,995,398
Tejassarnika Hydro Energies Private Limited 13,408,430 16,594,766
----------- -----------
The key assumptions used for value-in-use calculations are as
follows:
31 March 2014 31 March 2013
-------------------- --------------------
Budgeted Discount Budgeted Discount
gross rate gross rate
margin margin
--------- --------- --------- ---------
Hemavathy Power & Light Private
Limited - HLBC unit 89.00% 23.00% 85.80% 19.90%
LVS Power Private Limited 24.80% 20.00% 37.40% 25.70%
Hemavathy Power & Light Private
Limited - HRB unit 92.80% 22.10% 90.50% 19.30%
Tejassarnika Hydro Energies
Private Limited 85.80% 19.50% 94.20% 17.90%
--------- --------- --------- ---------
Management has determined gross margins based on industry trends
and the existing PPA with the transmission companies. The PPA is a
long-term contract with agreed price per unit of power sold, and
the growth rates used are consistent with those contracts. The
discount rate used is pre-tax and reflects the specific risks
associated with the entity.
9. Property, plant and equipment
Plant and Furniture and Capital
Land Buildings machinery equipment Vehicles work-in-progress Total
---------- ------------------ ------------------- ---------------------- ------------------- ------------------- --------------
Cost
At 1 April 2012 3,167,309 49,291,504 72,073,071 1,025,232 927,940 112,375,583 238,860,639
Additions 8,469 281,019 397,841 400,143 264,460 111,513,597 112,865,529
Acquisition through
business combination 194,542 52,434,719 16,831,589 63,524 89,492 3,461,189 73,075,055
Disposals/capitalisation (16,024) - (11,445) (1,080) (203,995) (157,599) (390,143)
Exchange differences (57,672) (1,753,310) (1,531,660) (15,821) 43,690 (1,935,156) (5,249,929)
---------- ------------------ ------------------- ---------------------- ------------------- ------------------- --------------
At 31 March 2013 3,296,624 100,253,932 87,759,396 1,471,998 1,121,587 225,257,614 419,161,151
Additions 5,156,003 4,097,265 193,041,379 768,725 287,699 210,213,983 413,565,054
Acquisition through
business combination - - - 291 - 1,182,771 1,183,062
Disposals/capitalisation (6,454) - - - (30,031) (191,532,573) (191,569,058)
Assets held for sale (247,154) (1,056,870) (8,015,384) (84,675) (5,669) (2,422) (9,412,174)
Exchange differences (397,092) (15,732,607) (9,397,297) (208,951) (170,929) (32,479,937) (58,386,813)
---------- ------------------ ------------------- ---------------------- ------------------- ------------------- --------------
At 31 March 2014 7,801,927 87,561,720 263,388,094 1,947,388 1,202,657 212,639,436 574,541,222
---------- ------------------ ------------------- ---------------------- ------------------- ------------------- --------------
Accumulated depreciation
and impairment
At 1 April 2012 - 2,990,004 8,920,053 271,446 233,410 - 12,414,913
Charge for the year - 3,035,796 3,523,218 158,290 117,652 - 6,834,956
Disposal - - (788) (306) (60,318) - (61,412)
Exchange differences - (30,383) (126,790) (3,194) 57,170 - (103,197)
---------- ------------------ ------------------- ---------------------- ------------------- ------------------- --------------
At 31 March 2013 - 5,995,417 12,315,693 426,236 347,914 - 19,085,260
Charge for the year - 2,869,153 7,321,830 251,819 116,265 - 10,559,067
Disposal - - - - 9,966 - 9,966
Assets held for sale - (215,526) (3,270,706) (47,279) (4,794) - (3,538,305)
Exchange differences - (1,001,268) (1,994,601) (62,883) (75,288) - (3,134,040)
---------- ------------------ ------------------- ---------------------- ------------------- ------------------- --------------
At 31 March 2014 - 7,647,776 14,372,216 567,893 394,063 - 22,981,948
---------- ------------------ ------------------- ---------------------- ------------------- ------------------- --------------
Net book value
At 31 March 2014 7,801,927 79,913,944 249,015,878 1,379,495 808,594 212,639,436 551,559,274
At 31 March 2013 3,296,624 94,258,515 75,443,703 1,045,762 773,673 225,257,614 400,075,891
At 1 April 2012 3,167,309 46,301,500 63,153,018 753,786 694,530 112,375,583 226,445,726
---------- ------------------ ------------------- ---------------------- ------------------- ------------------- --------------
Borrowings as at 31 March 2014 aggregating to EUR293,244,629 (31
March 2013: EUR247,863,208) are secured against all of the Group's
present and future moveable and immovable assets, including the
property, plant and equipment shown above. These loans are also
secured by the personal guarantees of certain directors and pledge
of shares of the subsidiaries held by the Group.
During the year, the Group has capitalised borrowing costs
amounting to EUR18,485,392 (31 March 2013: EUR21,178,906) on
qualifying assets. Borrowing costs were capitalised at the weighted
average rate of its general borrowings of 13.54 percent. Note 28
(e) provide details of asset purchase commitments outstanding as at
31 March 2014.
10. Financial assets and liabilities
The accounting policies for financial instruments have been
applied to the line items below:
31 March 2014
Financial
Loans and assets at Available-
receivables FVTPL for-sale Total
------------- ------------ ----------- ------------
Financial assets
Non-current
Other non-current financial
assets - 5,413,807 - 5,413,807
Bank deposits (note 14) 10,447,037 - - 10,447,037
Trade and other receivables
(note 12) 5,325,292 - - 5,325,292
Current
Available-for-sale financial
assets (note 11) - - 53,280 53,280
Bank deposits (note 14) 3,567,943 - - 3,567,943
Trade and other receivables
(note 12) 47,236,011 - - 47,236,011
Cash and cash equivalents
(note 14) 32,254,906 - - 32,254,906
Total 98,831,189 5,413,807 53,280 104,298,276
------------- ------------ ----------- ------------
Liabilities Liabilities measured
at FVTPL at amortised cost Total
------------- ------------------------- ------------
Financial liabilities
Non-current
Borrowings (note 18) - 278,165,338 278,165,338
Other financial liabilities - 26,397,448 26,397,448
Trade and other payables
(note 17) - 2,498,844 2,498,844
Current
Borrowings (note 18) - 72,144,826 72,144,826
Trade and other payables
(note 17) - 33,090,345 33,090,345
Total - 412,296,801 412,296,801
------------- ------------------------- ------------
31 March 2013
Loans and Available for
receivables sale Total
------------- --------------------- -----------
Financial assets
Non-current
Bank deposits (note 14) 7,542,157 - 7,542,157
Trade and other receivables
(note 12) 4,385,988 - 4,385,988
Current
Available-for-sale financial
assets (note 11) - 60,910 60,910
Bank deposits (note 14) 4,313,538 - 4,313,538
Trade and other receivables
(note 12) 41,993,537 - 41,993,537
Cash and cash equivalents (note
14) 23,921,007 23,921,007
Total 82,156,227 60,910 82,217,137
------------- --------------------- -----------
Liabilities
measured
Liabilities at amortised
at FVTPL cost Total
------------- -------------- ------------------
Financial liabilities
Non-current
Borrowings (note 18) - 229,812,108 229,812,108
Other financial liabilities - 24,474,057 24,474,057
Trade and other payables (note
17) - 2,064,903 2,064,903
Current
Borrowings (note 18) - 18,051,100 18,051,100
Trade and other payables (note
17) - 30,201,891 30,201,891
Total - 304,604,059 304,604,059
------------- -------------- ------------------
The carrying amounts reported in the statement of financial
position for cash and cash equivalents, trade and other
receivables, trade and other payables and other liabilities
approximate their respective fair values due to their short
maturity.
Fair value hierarchy
Financial assets and financial liabilities measured at fair
value in the statement of financial position are grouped into three
levels of a fair value hierarchy. The three Levels are defined
based on the observability of significant inputs to the
measurement, as follows:
Level 1 - Quoted prices (unadjusted) in active markets for
identical assets or liabilities.
Level 2 - Inputs other than quoted prices included within Level
1 that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices).
Level 3 - Inputs for the assets or liabilities that are not
based on observable market data (unobservable inputs).
The following table presents the fair value hierarchy of assets
and liabilities measured at fair value on a recurring basis as of
31 March 2014 and 31 March 2013:
31 March 2014
Level Level Level Total
1 2 3
------- ----------- ------ -----------
Financial assets
Available- for- sale financial
asset 53,280 - - 53,280
Other non-current financial assets - 5,413,807 - 5,413,807
Financial liabilities
Other financial liabilities - 26,397,448 - 26,397,448
------- ----------- ------ -----------
31 March 2013
Level Level Level Total
1 2 3
------- ----------- ------ -----------
Financial assets
Available- for- sale financial
asset 60,910 - - 60,910
Financial liabilities
Other financial liabilities - 24,474,057 - 24,474,057
------- ----------- ------ -----------
Measurement of fair value of financial instruments
The Group's finance team performs valuations of financial items
for financial reporting purposes in consultation with third party
valuation specialists for complex valuations. Valuation techniques
are selected based on the characteristics of each instrument, with
the overall objective of maximising the use of market-based
information.
The valuation techniques used for instruments categorised in
Level 2 are described below:
Other non-current financial assets (Level 2)
The estimated fair value of call and put options on WPG shares
with non-controlling interests is categorised within Level 2 of the
fair value hierarchy. The fair value estimate has been determined
considering inputs that include other than quoted prices of similar
assets/industry that are observable like interest rates, yield
curves, implied volatilities and credit spreads.
Other financial liabilities (Level 2)
The estimated fair value of the put option on WPP shares with
non-controlling interests is categorised within Level 2 of the fair
value hierarchy. The fair value estimate has been determined from
the perspective of market participants that holds similar
instrument as assets at 31 March 2014. The fair value of
EUR26,397,448 is estimated using a present value technique, by
discounting the contractual cash flows using implied yields of a
similar instrument of an entity with a similar standing and
marketability. The most significant input being the discount rate
that reflects the credit risk of counterparties.
11. Available-for-sale financial assets
31 March 31 March
2014 2013
------------------------ ----------
Beginning of the year 60,910 65,607
Additions - 642,307
Redemption - (642,307)
Exchange differences (6,257) (2,987)
Unrealized losses transferred to equity (1,373) (1,710)
------------------------ ----------
End of the year 53,280 60,910
Less: Non-current portion - -
------------------------ ----------
Current portion 53,280 60,910
------------------------ ----------
During the year ended 31 March 2014, dividend income aggregating
to EUR695 (31 March 2013: EUR19,234) was earned on investment in
units of mutual funds.
There are no impairment provisions on available-for-sale
financial assets during the year. None of the financial assets is
either past due or impaired. Available-for-sale financial assets
include the following:
31 March
31 March 2014 2013
-------------- ---------
Unlisted securities:
- Units of open-ended mutual funds 53,280 60,910
-------------- ---------
53,280 60,910
-------------- ---------
Available-for-sale financial assets are denominated in Indian
rupees. The maximum exposure to credit risk at the reporting date
is the fair value of the units of mutual funds classified as
available-for-sale.
12. Trade and other receivables
31 March
31 March 2014 2013
---------------------- -------------------
Trade receivables 31,739,484 11,938,925
Less: Provision for impairment of trade
receivables (242,189) (287,604)
---------------------- -------------------
Net trade receivables 31,497,295 11,651,321
---------------------- -------------------
Other receivables 16,665,083 32,250,973
Less: Provision for impairment of other
receivables (557,036) (661,490)
---------------------- -------------------
16,108,047 31,589,483
Pre-payments 709,755 560,020
Advance for expenses 149,428 226,967
Sundry deposits 346,592 654,717
Advance for purchase of equity 4,609,369 2,484,004
---------------------- -------------------
Total trade and other receivables 53,420,486 47,166,512
Less: Non-current portion (5,325,292) (4,385,988)
---------------------- -------------------
Current portion 48,095,194 42,780,524
---------------------- -------------------
Advance for purchase of equity represents interest free amounts
paid under memorandum of understanding with various parties which
have been identified as potential entities to be acquired in the
future. These advances do not provide the Group with additional
rights and are adjusted against the purchase consideration when the
transaction is consummated else these amounts are refunded by the
parties. Other receivables include advances against purchase of raw
materials, advances for expenses, and other advance
recoverable.
Borrowings of EURNil (31 March 2013: EUR1,616,842) are secured
against inventory and trade receivables.
With the exception of the non-current portion of trade and other
receivables all amounts are short-term and their carrying values
are considered a reasonable approximation of fair values.
Trade receivables that are due for more than one month are
considered past due. As at 31 March 2014, trade receivables of EUR
20,015,535 (31 March 2013: EUR5,315,514) were past due but not
impaired. EUR 19,579 (31 March 2013: EUR169,919) relate to power
tariff differences that are subject to judicial orders, and in the
opinion of the management there is a reasonable certainty of
realisation.
The ageing analysis of past due trade receivables as at the
reporting date is as follows:
31 March
31 March 2014 2013
------------------ ----------
1 to 6 months 6,717,692 1,978,223
6 to 9 months 4,371,564 382,250
9 to 12 months 1,950,182 375,308
Beyond 12 months 6,976,097 2,579,733
------------------ ----------
20,015,535 5,315,514
------------------ ----------
The carrying amounts of trade receivables are denominated in the
following currencies:
31 March 31 March
2014 2013
----------- --------------------
Indian rupee 29,423,568 8,821,479
Euro 2,073,727 2,829,842
31,497,295 11,651,321
----------- --------------------
Movements in provision for impairment of other receivables are
as follows:
31 March 31 March
2014 2013
-------------------- ---------
Beginning of the year 661,490 -
Provision for impairment of other receivables - 656,580
Advances written off during the year as
uncollectible - -
Exchange difference (104,454) 4,910
End of the year 557,036 661,490
-------------------- ---------
Movements in provision for impairment of trade receivables are
as follows:
31 March 31 March
2014 2013
--------------------- ---------
Beginning of the year 287,604 292,654
Exchange difference (45,415) (5,050)
End of the year 242,189 287,604
--------------------- ---------
The creation and release of provisions for impaired receivables
have been included in 'other operating expenses' in the profit or
loss. Amounts charged to the allowance account are generally
written off, when there is no expectation of recovering additional
cash.
The maximum exposure to credit risk at the reporting date is the
carrying value of each class of receivable mentioned above. The
Group does not hold any collateral as security.
13. Inventories
31 March
31 March 2014 2013
------------------- -------------------
Stores and consumables 2,047,822 2,825,354
Raw materials 2,215,008 2,609,670
Emission reductions 2,055,611 1,679,916
Renewable energy certificates 516,518 220,822
------------------- -------------------
6,834,959 7,335,762
------------------- -------------------
Borrowings of EURNil (31 March 2013: EUR1,616,842) are secured
against inventories and trade receivables. Cost of material
consumed during the year aggregated to EUR3,698,149(31 March 2013:
EUR5,072,020). There is no write down of inventories in the current
or previous year.
14. Cash and cash equivalents
31 March 31 March
2014 2013
---------------------- ------------------
Cash on hand 273,058 227,003
Cash at bank 31,981,848 23,694,004
32,254,906 23,921,007
---------------------- ------------------
In addition to the above, the Group holds balances in deposit
accounts with banks. These deposits are for various periods ranging
from a week to five years and carry fixed rate of interest.
Further, the Group can redeem these deposits with a short notice.
Bank deposits aggregating to EUR11,445,520 (31 March 2013:
EUR10,108,461) are restricted.
15. Assets and liabilities classified as held for sale
The assets and liabilities related to two biomass units viz. ISA
Power Private Limited and Ecofren Power & Projects Private
Limited have been presented as held for sale following the
intention of the group's management to sell these entities in the
near future. The management is evaluating various options to exit
and is taking active steps to complete the disposal of these
entities in the near future.
(a) Assets of disposal group classified as held for sale
31 March 31 March
2014 2013
----------- ---------
Intangible assets 100,618 -
Property, plant and equipment 5,873,869 -
Inventories 805,360 -
Other current assets 4,444,058 -
11,223,905 -
----------- ---------
(b) Liabilities of disposal group classified as held for
sale
31 March 31 March
2014 2013
----------------- ---------
Borrowings 1,820,596 -
Deferred tax liabilities 682,718 -
Other liabilities 102,904
2,606,218 -
----------------- ---------
In accordance with IFRS 5, the assets and liabilities held for
sale were written down to their fair value less costs to sell. This
is a non-recurring fair value which has been measured using agreed
prices with prospective buyer and is therefore falls in level 3 of
the fair value hierarchy. The difference between carrying cost and
fair value of EUR1,104,218, on classification of disposal group as
'held for sale', has been accounted under 'depreciation,
amortization and impairment' in the statement of profit or
loss.
16. Equity
16.1 Share capital
31 March 31 March
2014 2013
---------- ----------
Authorised capital
* 300,000,000 (31 March 2013: 215,000,000) ordinary
shares of
EUR0.005 each 1,500,000 1,075,000
Issued and fully paid
* 150,661,606 (31 March 2013: 150,661,606) ordinary
shares of EUR0.005 each 753,308 753,308
---------- ----------
16.2 Share-based payment reserve
During the year, the Company has granted 150,000 share options
to Mr. Keith Henry, Chairman of the Board, at the nominal value of
ordinary share. These share options will vest after a period of 2
years as per the terms approved by the Remuneration Committee.
Share-based payment of EUR118,126 was recognised as an expense in
the statement of profit or loss.
During 2013, pursuant to modification in the Long Term
Management Incentive Plan (LTIP), the Company had allotted
6,798,924 new ordinary shares to ACMK Enterprises Limited at par
value of EUR0.005 per share. The modified share-based payment was
fair valued at EUR8,070,124 of which EUR4,035,062 was recognised as
an expense in the statement of profit or loss and the balance
allocated to interest cost eligible for capitalisation in line with
the practise of allocation of costs to assets under construction.
On allotment of shares, the balance in share-based payment reserve
had been transferred to share premium.
16.3 Issuance of Preference Shares
In November 2009, Global Environment Emerging Markets Fund III
L.P. subscribed EUR30,943,314 for 36,369,551 Preference Shares
("PS") in Greenko Mauritius ("GM"), through its wholly owned
subsidiary GEEMF III GK Holdings MU, ("GEEMF") representing 29.99%
of the issued share capital of GM at completion, which was reduced
to 14.09% on further issue of equity shares to the Company and
other investors. PS will be redeemable in the event of a sale or
delisting but not eligible for interest payments or any right to a
fixed dividend. They will also be convertible into ordinary shares
in GM at the option of GEEMF.
Preference shareholders have the option in certain circumstances
to swap their redeemable preference shares for, in aggregate,
29,124,371 new ordinary shares of the Company pursuant to the put
option that was entered into with the Company. The put option is
exercisable between 1 January 2013 and 30 June 2017 or on happening
of a triggering event including sale or listing of Greenko Energies
Private Limited ("GEPL"). In addition, under certain circumstances,
the preference shareholders are also entitled to a variable number
of shares that provided for certain minimum returns on occurrence
of a default event.
During the year, the pre-conversion lock-in period and the
period for calculating the required return, have been extended and
accordingly put option is exercisable between 01 July 2015 and 30
June 2017. GEEMF's affirmative rights on management reserved
matters and shareholder reserved matters are also extended along
with its existing right to appoint two directors to the GM board.
Further as a result of this amendment, the warrant instrument held
by GEEMF to subscribe to additional shares was terminated.
Pursuant to the terms of amendment, the preference shareholder
has the right to exchange PS, subject to final adjustment, for a
minimum of 29,124,371 ordinary shares of the Company, anytime
between 1 July 2015 and 30 June 2017 and under certain specified
circumstances at a period earlier than 1 July 2015. The conversion
shall happen at such prices which would provide preference
shareholder with certain protective returns as per the terms of the
agreements.
16.4 Issuance of 'A Exchangeable Shares' in GM
During May 2013, Government of Singapore Investment Corporation
Pte Limited ("GIC") through its affiliate Cambourne Investments
Private Limited ("CIPL"), subscribed GBP100,000,000 to 74,074,074
"A Exchangeable Shares" ("AES") in GM. CIPL has the right to
exchange AES for ordinary shares of the Company on a one for one
basis. Pursuant to the terms of adjustment deed, CIPL has the
right, subject to final adjustment, for a minimum of 44,861,538
ordinary shares of the Company, anytime between 1 July 2015 and 30
June 2017 and under certain specified circumstances at a period
earlier than 1 July 2015. The conversion shall happen at such
prices which would provide AES with certain protective returns as
per the terms of the agreements.
If CIPL does not exercise this right, the AES shall be
automatically exchanged at the expiry of the Exchange Period 01
July 2017. However, the shareholding of CIPL in the Company,
including any shares already held, shall not exceed 29.99% and the
remaining AES, if any, shall remain at the GM.
Based on the underlying character of these agreements, the
management has viewed these as a single, linked transaction. The
conversion feature has been accounted as an embedded derivative
which is accounted at fair value at inception and the AES has been
classified as equity representing the difference between the total
amount received and the fair value of the embedded derivative.
16.5 Other reserves - government grants
Government of India ("GoI") has been providing cash grants to
grid-interactive power generation projects based on renewable
energy sources. The quantum of cash grant is linked to the power
generation capacity of the project. In respect of projects which
are financed by a financial institution, the request for the cash
grant has to be placed by the financial institution. The financial
institution directly receives the cash grant from GoI towards
reduction of loan.
17. Trade and other payables
31 March 31 March
2014 2013
----------------------- -----------------------
Trade payables 1,411,235 837,799
Capital creditors 26,093,308 8,436,822
Other payables 4,601,951 8,810,173
Cost of acquisition payable 3,317,611 14,131,463
Issue expenses payable 165,084 50,537
----------------------- -----------------------
Total 35,589,189 32,266,794
Less: Non-current portion - Trade and
other payables 2,498,844 2,064,903
----------------------- -----------------------
Current portion - Trade and other payables 33,090,345 30,201,891
----------------------- -----------------------
Other payables include accruals for expenses, statutory
liabilities and other liabilities. All amounts are short term and
the carrying values of trade and other payables are considered a
reasonable approximation of fair value.
18. Borrowings
31 March 31 March
2014 2013
------------ ------------
Non-current - Financial liabilities measured
at amortised cost
Bank borrowings 128,391,166 83,799,762
Term loans from financial institutions
and others 149,715,579 143,089,686
Equipment and vehicle loans 58,593 66,953
Interest accrued but not due - 2,855,707
278,165,338 229,812,108
------------ ------------
Current - Financial liabilities measured
at amortised cost
Bank borrowings 7,504,959 8,180,921
Term loans from financial institutions
and others 55,937,186 6,966,069
Equipment and vehicle loans 75,178 91,903
Interest accrued but not due 8,627,503 2,812,207
72,144,826 18,051,100
------------ ------------
Total borrowings 350,310,164 247,863,208
------------ ------------
18.1. Bank borrowings mature over 2014 to 2029 and bear floating
rates of interest. The fair value of bank borrowings approximates
their carrying value as these borrowings carry a floating rate of
interest.
18.2. Total borrowings are secured against first charge by way
of hypothecation of all immovable properties including plant and
machinery and all other movable properties both present and future,
and mortgage of land and buildings both present and future,
personal guarantees of directors and pledge of shares. Working
capital loans are secured by inventory and trade receivables.
Additionally, the borrowings are also secured by a lien on bank
deposits amounting to EUR 10,030,862 (31 March 2013:
EUR9,613,455).
18.3. The maturity profile of the Group's borrowings at the
reporting dates is as follows:
31 March 31 March
2014 2013
------------ ------------
1 year or less, or on demand 72,144,826 18,051,100
1 to 2 years 22,301,394 72,866,004
2 to 5 years 89,478,267 72,609,159
Over 5 years 166,385,677 84,336,945
350,310,164 247,863,208
------------ ------------
18.4. The carrying amounts and fair value of the borrowings are
as follows:
31 March 2014 31 March 2013
-------------------------- --------------------------------
Carrying Carrying
amount Fair value amount Fair value
------------ ------------ --------------- ---------------
Bank borrowings 135,896,125 135,896,125 91,980,683 91,980,683
Loans from financial institutions
and others 205,652,765 205,652,765 150,055,755 150,055,755
Equipment and vehicle loans 133,771 133,771 158,856 158,856
------------ ------------ --------------- ---------------
18.5. The carrying amounts of the Group's borrowings are
denominated in the following currencies:
31 March 31 March
2014 2013
------------------ ---------------
Indian rupee 293,426,271 191,302,211
US dollar 56,883,893 56,560,997
350,310,164 247,863,208
------------------ ---------------
18.6. During 2012, GM signed a loan agreement for $ 70 million
(EUR54.62 million) with Standard Chartered Private Equity
(Mauritius) III Limited ("StanChart"). The loan amount is divided
into two facilities viz. Facility A for $31.5 million (EUR24.58
million) and Facility B for $38.5 million (EUR30.04 million). In
Facility B, StanChart has an option but not obligation to convert
the loan amount along with agreed internal rate of return (IRR) on
the investment, either in full or in part, into equity shares of
the Company or Greenko Energies Private Limited (GEPL) in case of
its qualifying initial public offer (IPO), or any subsidiaries of
GEPL in case of such subsidiaries' qualifying IPO. At the end of
the third year, all unconverted loan amount shall be redeemed at a
valuation which would deliver the agreed IRR to StanChart. The IRR
is contingent upon future events. Further, interest is payable
semi-annually on both the facilities. The facility is secured by
pledge of 130 million equity shares of GM held by the Company.
18.7. GE Equity International Mauritius ("GE") has invested $50
million in the wind holding company of the Group. GE purchased 100%
interest in Wind Power Projects (Mauritius) Limited ("WPP") from GM
for a consideration of $25.56 million (EUR19.13 million) during
March 2012. In February 2013, the Group sold a 100 percent interest
in Wind Power Generations (Mauritius) Limited ("WPG") to GE for a
consideration of $24.42 million (EUR18.05 million). GE has certain
preferential rights as to payment of dividends and on liquidation
over the Group. The Company has an option to call on the WPG shares
held by GE in WPG between February 2016 to February 2017 while GE
has an option to put any of the WPP and WPG shares to the Company
between February 2017 to February 2018 or on the occurrence of
certain events as mentioned in the agreements. The options should
be exercised at such prices which would provide GE with certain
protective returns as per the terms of the agreements.
Based on the underlying character of the instruments, the Group
has classified the arrangement as an equity transaction and the
effective ownership interest of the GE in Greenko Wind is 20.76 per
cent (31 March 2013: 43.40 per cent) as at 31 March 2014. The
mandatory dividends on preference shares have been recognized as a
liability valued at EUR4,803,703 (31 March 2013: EUR4,834,308) as
at 31 March 2014. The options have been valued in accordance with
the accounting policy (note 2.9).
19. Deferred income tax liabilities
Deferred income tax assets and liabilities are offset when there
is a legally enforceable right to offset current tax assets and
current tax liabilities from the same taxation authority. The
offset amounts are as follows:
31 March 31 March
2014 2013
---------------- -----------
Deferred income tax liabilities
- to be recovered after more than 12 months 34,036,363 35,470,245
- to be recovered within 12 months - -
---------------- -----------
34,036,363 35,470,245
---------------- -----------
The movement in deferred income tax liabilities during the year
is as follows:
Tangible Intangible Others Total
assets assets
----------------------- --------------------- ------------------- --------------------
At 31 March 2012 6,638,210 15,846,449 30,982 22,515,641
Recognised in profit
or loss 869,304 (470,049) (8,484) 390,771
Acquisition of subsidiary 2,107,878 10,915,109 - 13,022,987
Disposal - (8,667) 3,376 (5,291)
Exchange difference (144,419) (308,849) (595) (453,863)
----------------------- --------------------- ------------------- --------------------
At 31 March 2013 9,470,973 25,973,993 25,279 35,470,245
Recognised in profit
or loss (808,602) (408,262) (9,409) (1,226,273)
Acquisition of subsidiary - 3,873,025 - 3,873,025
Assets held for sale (672,678) (10,040) - (682,718)
Exchange difference 129,332 (3,542,145) 14,897 (3,397,916)
----------------------- --------------------- ------------------- --------------------
At 31 March 2014 8,119,025 25,886,571 30,767 34,036,363
----------------------- --------------------- ------------------- --------------------
Deferred income tax assets are recognised for tax loss carry
forwards to the extent that the realisation of the related tax
benefit through the future taxable profits is probable.
The Company is subject to Isle of Man corporate tax at the
standard rate of zero percent. Further, dividends are not taxable
in India in the hands of the recipient. However, the Indian
subsidiaries will be subject to a 'dividend distribution tax'
currently at the rate of 15% (plus applicable surcharge and
education cess) on the total amount distributed as dividend. As at
31 March 2014 and 31 March 2013, there was no recognised deferred
tax liability for taxes that would be payable on the unremitted
earnings of certain of the Group's subsidiaries, the Group has
determined that undistributed profits of its subsidiaries will not
be distributed in the foreseeable future as the Group earnings will
continue to be full re-invested to finance the on-going growth of
the Group.
20. Revenue
31 March 31 March
2014 2013
-------------------- --------------------
Sale of power 51,424,912 34,409,745
Sale of emission reductions - 2,352,823
Sale of renewable energy certificates 653,005 1,582,829
Generation based incentive 932,904 -
53,010,821 38,345,397
-------------------- --------------------
21. Other operating income includes profit on disposal of a
subsidiary amounting to EURNil (31March 2013: EUR 1,154,647).
22. Retirement benefit obligations
31 March 31 March
2014 2013
-------------------- ----------------------
Statement of financial position obligation
for
Gratuity 209,747 227,091
Compensated absences 146,046 144,655
355,793 371,746
-------------------- ----------------------
Expense recognised in the profit or loss
Gratuity 20,287 75,733
Compensated absences 21,331 52,152
41,618 127,885
-------------------- ----------------------
The principal actuarial assumptions used were as follows:
31 March 31 March
2014 2013
--------- ---------
Discount rate 8.70% 8.06%
Future salary increases 7% 7%
Return on plan assets 8% 9%
Retirement age 60 years 60 years
The Group makes annual contributions under a group gratuity plan
to Life Insurance Corporation of India ("LIC") of an amount advised
by LIC. The Group is not informed by LIC of the investments made by
the LIC or the break-down of plan assets by type of investments.
The expected rate of return on plan assets is based on the
expectation of the average long-term rate of return expected on the
insurer managed funds during the estimated term of the obligation.
The Group expects to contribute EUR18,001 towards the gratuity plan
in the year ended 31 March 2015.
23. Employee benefit expense
31 March 31 March
2014 2013
---------------------- ----------------------
Salaries and wages 3,470,609 3,437,599
Value of employee services (note 16.2) 118,126 4,035,062
Employee welfare expenses 288,106 326,635
Retirement benefits-defined contribution
plans 153,736 174,530
Retirement benefits-defined benefit plans
(note 22) 20,287 75,733
Compensated absences (note 22) 21,331 52,152
---------------------- ----------------------
4,072,195 8,101,711
---------------------- ----------------------
24. Other operating expenses include directors' fee of
EUR286,698 (31 March 2013: EUR193,202) and auditor's remuneration
of EUR140,000 (31 March 2013: EUR120,000).
25. Finance income and costs
31 March 31 March
2014 2013
---------------------- --------------------
Finance income
Foreign exchange gain 3,845,414 2,462,725
Interest on bank deposits and others 898,041 1,102,144
Dividend from units of mutual funds 695 19,234
----------------------
4,744,150 3,584,103
---------------------- --------------------
Finance cost
Interest on borrowings 16,867,232 13,858,590
Bank charges 1,840,920 1,484,544
18,708,152 15,343,134
---------------------- --------------------
Net finance costs (13,964,002) (11,759,031)
---------------------- --------------------
26. Income tax expense
31 March
31 March 2014 2013
---------------------- ------------------
Current tax 2,938,693 1,553,360
Deferred tax (note 19) 1,226,273 390,771
4,164,966 1,944,131
---------------------- ------------------
The tax on the Group's profit before tax differs from the
theoretical amount that would arise using the weighted average tax
rate applicable to profits of the Company as follows:
31 March 31 March
2014 2013
--------------------- ----------
Profit before income tax 13,486,007 7,959,571
Domestic tax rate for Greenko Group plc 0% 0%
Expected tax expense - -
Adjustment for tax differences in foreign
jurisdictions 4,164,966 1,944,131
Tax charge 4,164,966 1,944,131
--------------------- ----------
The tax rates used in computing the weighted average tax rate is
the substantively enacted tax rate. In respect of the Indian
entities this was 32.45% (31 March 2013: 32.45%).
The Indian subsidiaries of the Group engaged in power generation
currently benefit from a tax holiday from the standard Indian
corporate taxation for the years ended 31 March 2013 and 2014. The
tax holiday period under the Indian Income Tax Act is for 10
consecutive tax assessment years out of a total of 15 consecutive
tax assessment years from the tax assessment year in which
commercial operations commenced. However, these companies are still
liable for Minimum Alternate Tax which is calculated on the book
profits of the relevant entity and is currently at a rate of 20.01%
(31 March 2013: 20.01%).
27. Earnings per share
a) Basic
Basic earnings per share, is calculated by dividing the profit
attributable to equity holders of the Company by the weighted
average number of ordinary shares in issue during the year.
31 March
31 March 2014 2013
------------------------ ------------
Profit attributable to equity holders
of the Company 6,776,211 4,353,259
Weighted average number of ordinary shares
in issue 150,661,606 148,286,819
Basic earnings per share (in cents) 4.50 2.94
------------------------ ------------
b) Diluted
Diluted earnings per share is calculated by adjusting the
weighted average number of ordinary shares outstanding to assume
conversion of all dilutive potential ordinary shares.
31 March 31 March
2014 2013
--------------------- ------------
Profit attributable to equity holders
of the Company 6,776,211 4,353,259
Increase in non-controlling interests
share of Group profit 1,401,404 -
--------------------- ------------
Total profit attributable to equity holders
of the Company 8,177,615 4,353,259
Reconciliation of number of shares
Weighted average number of equity shares
-For basic earnings per equity share 150,661,606 148,286,819
Add: Shares deemed to be issued against
swap option issued to PS holders 9,671,795 6,516,654
Add: Adjustment for assumed conversion
of AES 40,559,747 -
Add: Stock option to be exercised 149,995 -
-For diluted earnings per equity share 201,043,143 154,803,473
Diluted earnings per share (in cents) 4.07 2.81
--------------------- ------------
28. Commitments and contingencies
a) GEPL and Roshni Powertech Private Limited operate biomass
power plants located in the State of Andhra Pradesh, India. These
entities through the Biomass Energy Developers Association have
challenged the order of Andhra Pradesh Electricity Regulatory
Commission ("APERC") effecting a downward revision in billing
rates. The Supreme Court of India has upheld the original billing
mechanism as binding on the customer and has remanded the case back
to APERC to determine the final tariff per unit. Since APERC could
not issue an executable order, in an interim order the Appellate
Tribunal for Electricity (Appellate Tribunal) has directed for
payment of provisional amounts to the energy producers. Thereafter,
in 2012-13, Appellate Tribunal passed orders refixing certain
parameters and directing APERC to re-determine the tariff payable
since April 2010. These orders are challenged before Supreme Court
and the cases are pending.
During the year, APERC has issued the final tariff along with
interest vide orders dated 22 June 2013 and 6 August 2013. In this
regard, the Distribution Companies approached the Supreme Court of
India expressing their inability to make the payment in respect to
which the Supreme Court of India directed the Distribution
Companies to make payment of 50% of the tariff outstanding which
was received and in regard to balance payment, orders are awaited
from Supreme Court of India.
b) Few of the Group's power generating units in India have
income tax disputes with the tax authorities. The Group has
appealed against the orders of the income tax officer/authority at
appropriate levels. The Group has been successful in obtaining
favourable orders in few cases. The tax authorities have appealed
against these orders. Based on assessment of these claims, the
management is confident of ultimate favourable outcome.
c) In December 2010, Sai Spurthi Power Private Limited (SSPPL),
an entity acquired by the Group in March 2010, received a letter
from Punjab National Bank informing SSPPL that three corporate
guarantees aggregating to EUR9,065,150 were given by SSPPL in
respect of loans availed by Sagar Power (Neerukatte) Limited, a
company promoted and owned by erstwhile management of SSPPL. On
verification of records and discussions with the erstwhile
management, the management believes that only one corporate
guarantee of EUR850,085 was provided to the bank. The management is
confident that the contingent liability of SSPPL under the
corporate guarantees issued will not exceed EUR850,085. Further, as
per the terms of share purchase agreement with the
promoters/erstwhile seller-shareholders of SSPPL, the
promoters/erstwhile seller-shareholders of SSPPL are required to
have the corporate guarantee(s) released without any liability to
SSPPL or the Group.
During 2012-13, SSPL received a communication from IREDA
informing that SSPL had given a corporate guarantee of EUR1,453,136
for the credit facilities availed by M/s. Bhadragiri Power Private
Limited. On verification of records and discussions with the
erstwhile Managing Director, SSPL came to an opinion that the said
Corporate Guarantee was not executed on behalf of SSPL and hence
SSPL is not responsible for any liability under those documents.
This is a matter of dispute which needs to be finally settled. The
promoters/erstwhile seller-shareholders are responsible and
obligated to the Group to settle this.
d) Him Kailash Hydro Power Private Limited (HKHPPL) has given
corporate guarantee in respect of a term loan of EUR1,755,873
sanctioned to Madhava Vasistha Hydro Power Private Limited, a
company owned by erstwhile owners of HKHPPL. Pursuant to the terms
of share purchase agreement with erstwhile owners of HKHPPL,
erstwhile owners of HKHPPL are required to get the corporate
guarantee released without any liability to HKHPPL or the Group
e) Capital commitments
Capital expenditure contracted for at 31 March 2014 but not yet
incurred aggregated to EUR71,472,001 (31 March 2013:
EUR99,502,621).
f) The Group has entered a share purchase agreement with Lanco
Hydro Power Limited to acquire 100% stake of its subsidiary viz.,
Lanco Budhil Hydro Power Private Limited with a 70 MW operating
capacity. The purchase consideration for the said acquisition will
be EUR67.8 million (equivalent of INR 5,600 millions) as reduced by
the liabilities on the date of acquisition. Further the Group also
agreed to pay an additional consideration on fulfilment of certain
terms and conditions of the share purchase agreement.
29. Business combinations
29.1 Acquisitions of business during the year ended 31 March 2014
During the year ended 31 March 2014, the Group acquired the
following companies to enhance the generating capacity of the Group
from clean energy assets. Details of these acquisitions are set out
below:
Effective Date of acquisition Percentage acquired
------------------------------- --------------------
Harsar Hydro Projects Private Limited (HHPPL) 1 July 2013 100.00%
Bharmour Hydro Projects Private Limited (BHPPL) 1 July 2013 100.00%
HHPPL and BHPPL hold licenses to develop 75MW and 40MW of hydel
projects in the state of Himachal Pradesh, India respectively.
These projects had obtained significant approvals to implement the
projects and these projects were under various stages of
development at the date of acquisition. These projects are
hereinafter collectively referred as 'Himachal Projects'.
Generally, the total gestation period, starting from obtaining a
licence till commencement of commercial operations, for these types
of hydro power projects is four to five years. Hence, the projects
have significant value embedded in them, which is generally not
reflected in the books of account, and captured in the fair value
of licences. The excess of the Group's interest in the fair value
of an acquiree's assets and liabilities over cost resulting from
the time value which the Group gained, the value in readiness for
implementation and the negotiating skills of the Group.
Details of net assets acquired are as follows:
Himachal Projects
------------------
Purchase consideration:
- Cash paid 5,332,333
- Amounts paid as advance in earlier year 500,028
Total Purchase consideration 5,832,361
------------------
Fair value of net asset acquired 8,089,626
------------------
Excess of Group's interest in fair value of acquirees'
assets and liabilities (2,257,265)
------------------
Fair value of the acquiree's assets and liabilities arising from
the acquisition are as follows:
Himachal Projects
-------------------
Property, plant and equipment 291
Work in progress 1,182,771
Licence 11,937,200
Trade and other receivables 1,286
Cash and cash equivalents 28,949
Trade and other payables (1,187,846)
Deferred income tax liabilities (3,873,025)
-------------------
Net assets 8,089,626
-------------------
Purchase consideration settled in cash 5,332,333
Cash and cash equivalents (28,949)
-------------------
Cash outflow on acquisition 5,303,384
-------------------
Since the above companies were in the construction phase, they
did not generate revenue and profits for the Group for the year
ended 31 March 2014.
29.2 Acquisitions of business during the year ended 31 March
2013
During the year ended 31 March 2013, the Group acquired the
following companies to enhance the capacity of the Group from clean
energy assets. Details of these acquisitions are set out below:
Date of acquisition Percentage acquired
--------------------- --------------------
AT Hydro Private Limited (ATHPL) 1 April 2012 100%
Cimaron Constructions Private Limited (CCPL) 1 April 2012 100%
Tarela Power Limited (TPL) 1 April 2012 100%
Tejassarnika Hydro Energies Private Limited (THEPL) 1 April 2012 100%
Him Kailash Hydro Power Private Limited (HKHPPL) 1 April 2012 100%
Sri Sai Krishna Hydro Energies Private Limited (SSKHEPL) 1 April 2012 100%
Anubhav Hydel Power Private Limited (AHPPL) 1 April 2012 100%
Kumaradhara Power Private Limited (KPPL) 21 April 2012 100%
Rangaraju Warehousing Private Limited (RWPL) 1 April 2012 100%
Rapum Hydro Power Private Limited (RHPPL) 30 March 2013 100%
Kangtangshiri Hydro Power Private Limited (KHPPL) 30 March 2013 100%
Mechuka Hydro Power Private Limited (MHPPL) 30 March 2013 100%
Rego Hydro Project (RHP) 30 March 2013 100%
RHPPL, KHPPL, MHPPL and RHP collectively hold licenses to
develop 320 MW of hydel projects in the state of Arunachal Pradesh.
These projects had obtained significant approvals to implement the
projects and these projects were under various stages of
development at the date of acquisition. These projects are
hereinafter collectively referred as 'Arunachal Projects.
The Group has acquired 100% of the equity in ATHPL, CCPL, TPL,
THEPL, HKHPPL, SSKHEPL and AHPPL which has operating hydel power
projects of 5MW, 5MW, 5MW, 12MW, 5MW, 10MW and 5 MW respectively in
the State of Himachal Pradesh, India.
By virtue of the Group acquiring of SSKHEPL and HKHPPL which
have a combined shareholding of 53.7% in RWPL, RWPL became a
subsidiary of the Company. It has an operating hydel power project
of 14MW in the State of Himachal Pradesh, India and the balance of
46.3% is shown as non-controlling interests. Subsequently during
the year the Group acquired the 46.3% non-controlling interest.
Excess of consideration over the fair value of non controlling
interests is recognised in equity under other reserves.
Goodwill is primarily related to expected future profitability,
the substantial skill and expertise of the workforce and expected
cost synergies. Goodwill is not expected to be deductible for tax
purposes.
The Group has also acquired 100% equity in KPPL which has a 24MW
hydel power project under development in the state of Karanataka,
India. The implementation of the project was in progress at the
time of acquisition.
Generally, the total gestation period, starting from obtaining a
licence till commencement of commercial operations, for these types
of hydro power projects is four to five years. Hence, the projects
have significant value embedded in them, which is generally not
reflected in the books of account, and captured in the fair value
of licences and power purchase agreements. The excess of the
Group's interest in the fair value of an acquiree's assets and
liabilities over cost resulting from the time value which the Group
gained, the value in readiness for implementation and the
negotiating skills of the Group.
Details of net assets acquired and goodwill are as follows:
ATHPL CCPL TPL THEPL HKHPPL SSKHEPL AHPPL KPPL Arunachal Total
Projects
---------- ---------- ---------- ---------- ------------ ------------ ---------- ---------- ------------ ------------
Purchase
consideration:
- Cash paid 1,311,074 1,319,372 1,537,385 4,964,806 3,186,001 3,247,732 2,305,385 131,694 7,090,486 25,093,935
- Amounts paid
as advance
in earlier
year 1,347,851 777,649 543,966 605,282 169,740 - - 316,067 4,062,922 7,823,477
- Amounts
payable 589,897 1,611,097 906,349 2,160,542 739,060 4,246,220 1,130,041 285,338 740,581 12,409,125
- Fair Value of
Investment
in RWPL - - - - (1,053,311) (1,246,497) - - - (2,299,808)
---------- ---------- ---------- ---------- ------------ ------------ ---------- ---------- ------------ ------------
Total Purchase
consideration 3,248,822 3,708,118 2,987,700 7,730,630 3,041,490 6,247,455 3,435,426 733,099 11,893,989 43,026,729
Fair value of
net asset
acquired 2,795,683 2,875,606 2,350,488 5,762,087 3,297,438 5,447,805 3,055,301 939,356 18,906,118 45,429,882
---------- ---------- ---------- ---------- ------------ ------------ ---------- ---------- ------------ ------------
Goodwill 453,139 832,512 637,212 1,968,543 - 799,650 380,125 - - 5,071,181
Excess of
Group's
interest
in fair value
of acquirees'
assets and
liabilities - - - - (255,948) - (206,257) (7,012,129) (7,474,334)
---------- ---------- ---------- ---------- ------------ ------------ ---------- ---------- ------------ ------------
Fair value of the acquiree's assets and liabilities arising from
the acquisition were as follows:
ATHPL CCPL TPL THEPL HKHPPL SSKHEPL RWPL AHPPL KPPL Arunachal Total
Projects
------------ ------------ ------------ ------------- ------------- ------------ ------------ ------------ ----------- ------------ -------------
Property, plant
and equipment 6,082,668 5,387,968 6,382,117 12,104,272 4,597,278 12,038,964 15,376,657 7,606,719 - 37,224 69,613,867
Work in progress - - - - - - - - 769,387 2,691,802 3,461,189
Licence 512,145 512,145 512,145 1,229,148 512,145 1,024,290 1,229,148 512,145 1,229,148 27,947,945 35,220,404
Electricity PPA 58,531 43,898 29,265 351,185 29,265 73,164 219,491 - - - 804,799
Inventories 649 1,190 - - - 20,403 - 3,737 - - 25,979
Trade and other
receivables 1,028,616 2,198,900 1,065,159 4,278,751 2,329,995 839,822 810,754 170,681 - 353,196 13,075,874
Cash and cash
equivalents 84,155 10,301 224,640 112,408 80,216 47,416 93,944 43,466 4,775 13,301 714,622
Borrowings (3,724,729) (4,167,076) (4,389,816) (9,730,758) (2,400,695) (7,023,705) (8,779,631) (4,389,816) - (1,306,155) (45,912,381)
Trade and other
payables (861,840) (791,090) (1,318,990) (2,197,459) (1,200,322) (608,133) (4,299,630) (562,919) (665,157) (1,763,485) (14,269,025)
Deferred income
tax liabilities (384,512) (320,630) (154,032) (385,460) (650,444) (964,416) (368,274) (328,712) (398,797) (9,067,710) (13,022,987)
Net assets 2,795,683 2,875,606 2,350,488 5,762,087 3,297,438 5,447,805 4,282,459 3,055,301 939,356 18,906,118 49,712,341
------------ ------------ ------------ ------------- ------------- ------------ ------------ ------------ ----------- ------------ -------------
Non-Controlling
interests - - - - - (1,982,651) - - - (1,982,651)
Net assets
acquired 2,795,683 2,875,606 2,350,488 5,762,087 3,297,438 5,447,805 2,299,808 3,055,301 939,356 18,906,118 47,729,690
Purchase
consideration
settled in cash
(Net of advances) 1,311,074 1,319,372 1,537,385 4,964,806 3,186,001 3,247,732 - 2,305,385 131,694 7,090,486 25,093,935
Cash and cash
equivalents (84,155) (10,301) (224,640) (112,408) (80,216) (47,416) (93,944) (43,466) (4,775) (13,301) (714,622)
------------ ------------ ------------ ------------- ------------- ------------ ------------ ------------ ----------- ------------ -------------
Cash outflow on
acquisition 1,226,919 1,309,071 1,312,745 4,852,398 3,105,785 3,200,316 (93,944) 2,261,919 126,919 7,077,185 24,379,313
------------ ------------ ------------ ------------- ------------- ------------ ------------ ------------ ----------- ------------ -------------
Details of net profit contributed by the acquired entities for
the period commencing from acquisition date to the reporting
date:
Net profit/(loss)
-----------------------------------------
ATHPL 243,855
CCPL 390,174
TPL 308,163
THEPL (42,446)
HKHPPL 205,922
SSKHEPL 109,968
AHPPL (33,022)
KPPL (1,949)
RWPL (623,892)
RHPPL* -
KHPPL* -
MHPPL* -
-----------------------------------------
556,773
-----------------------------------------
*Since the companies were in the construction phase, they
did not generate revenue and profits for the Group for the
year ended 31 March 2013.
30. Related-party transactions
The Group is not controlled by any single individual or group or
entity. GIC and GEEMF with their substantial shareholding in
Greenko Mauritius and certain management reserved rights have
significant influence over the Group. Further, ACMK Enterprises
Limited, in which Anil Kumar Chalamalasetty and Mahesh Kolli have a
beneficial interest, holds 14.37% in the Company.
The following transactions were carried out with related
parties:
a. Key management compensation
31 March
31 March 2014 2013
--------------- ----------
Short-term employee benefits
Anil Kumar Chalamalasetty 231,000 231,000
Mahesh Kolli 231,000 231,000
Keith Nicholas Henry 96,620 26,535
John Rennocks 48,310 -
Harish Chandra Prasad Y - 45,000
Vivek Tandon 45,166 40,000
Hari Kiran Vadlamani 48,301 40,000
Narsimharamulu Pantam - 1,667
Vinodka Murria 48,301 40,000
Vasudeva Rao Kaipa 100,000 100,000
Bonus to Executive Directors (refer
30 b) 240,000 240,000
--------------- ----------
Total short-term employee benefits 1,088,698 995,202
Share-based payments
Keith Nicholas Henry 118,126 -
ACMK Enterprises Limited - 8,070,124
--------------- ----------
Total remuneration 1,206,824 9,065,326
--------------- ----------
b. The management has provided towards the performance bonus of
EUR240,000 (31 March 2013: EUR240,000) for the year. The balance
payable as at year-end is EUR480,000 (31 March 2013:
EUR240,000).
c. Anil Kumar Chalamalasetty and Mahesh Kolli have given
personal guarantees in respect of loans availed by subsidiaries of
the Group.
d. During the year, Kukke Hydel Projects Private Limited, a
subsidiary of the group, had borrowed an interest free unsecured
loan of EUR605,473 (31 March 2013: Nil) from Venture Finance &
Development Corporation Limited, a company in which Hari Kiran
Vadlamani, director of the Company is interested. The balance
payable as at year-end is EUR605,473 (31 March 2013: Nil).
31. Segment reporting
The Group has adopted the "management approach" in identifying
the operating segments as outlined in IFRS 8. The Group operations
predominantly relate to generation and sale of electricity. The
chief operating decision maker evaluates the Group performance and
allocates resources based on an analysis of various performance
indicators at operational unit level. Accordingly there is only a
single operating segment "generation and sale of electricity and
related emission reductions". Consequently no segment disclosures
of the Group are presented.
The Group has majority of its assets and liabilities, located
within India, and earn its revenues from customers located in
India, except EURNil (31 March 2013: EUR2,344,903) representing
revenue from sale of ERs to customers located outside India.
Revenues from four major customers relating to power generating
activities represent EUR34,217,511 (31 March 2013: EUR25,726,495)
of the total revenue.
32. Events after the reporting date
Post year end, the Group has commissioned 100 MW of new wind
assets.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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