JSW Energy (533148) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition of a 4.7GW renewable platform accelerates growth, increasing locked-in capacity by 23% to approximately 25GW.

• Integrates high-quality renewable assets and experienced management, including 370 skilled employees, supporting a sustainable future and strong execution.

• Enhances portfolio with diverse generation modes: wind, solar, hybrid, and round-the-clock solutions, expanding technology mix and geographic reach.

• Provides access to additional connectivity (1,708MW) and land for future projects, with secured land for 40% of under-construction and pipeline projects.

Financial terms and conditions

• Enterprise value of INR 12,468 crores for the 4.7GW platform, adjusted for net working capital.

• Steady state EBITDA expected at INR 1,500 crores for 2.3GW operational by June 2025, and INR 3,750 crores for full 4.7GW; EV/EBITDA multiple projected at 6.8-7.1.

• Blended tariff of INR 3.37/kWh, with 87% of the portfolio contracted to utilities and strong credit profile.

• Equity IRR expected to exceed 17%, supporting prudent capital allocation.

Synergies and expected cost savings

• Location overlap and presence in 5 of 7 states enable O&M cost synergies and integration with digital command center.

• Cost savings anticipated through technology-backed O&M practices and integration of C&I portfolio, raising C&I capacity to 3.7GW.