India Ratings maintains stable outlook for solar projects in FY 2024


India Ratings and Research (Ind-Ra) has maintained a Stable outlook for solar power projects and a Negative outlook on wind power projects in FY 2024.

IndRa stated solar projects continue to have stable operations, adequate debt service coverage, and comfortable internal liquidity. The significant fall in module prices over the past six months is positive for under-construction projects. However, timely project completion is critical in view of the slowdown in capacity addition observed in 1H FY24 compared to the previous year.

According to Ind-Ra, India installed 5 GW of solar capacity and 1.6 GW of wind in 1H FY24, compared to 6.8 GW of solar and 1.3 GW of wind added in 1H FY23. The capacity addition for the entire FY23 stood at 12.8 GW solar and 2.3 GW wind.

Wind projects continue to be marred by generation variability.

Ind-Ra expects wind power generation in FY24 to be similar to FY23, while remaining lower than the P90 level, considering the portfolio average. Elimination of reverse auction is likely to allow developers to bid with a better risk-return profile and improve the capacity addition in the medium term.


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