Key takeaways of the call

Order intake in Q3FY16 is about 110 MW. So order book of the company as end of December 31, 2015 was 1146 MW. Current order book will be executed in next 12-15 months. Of the order book about 40% is from the state of MP, 20% from Rajasthan, 20% from Gujarat and rest from AP.

It also sees significant traction in order inflow during the coming quarter. The government of India's thrust on the development of renewable sources of energy is emphasized by the revised tariff policy which levies no inter-state transmission charges and losses for power from renewable sources and introduces the Renewable Generator Obligation. With a supportive regulatory framework, India's wind market is expected to be one of the world's fastest growing.

With tariff policy coming for expiry in March 2016 for about 3 states, the clients hold back order finalization for want of clarity. Now with lot of clarity emerging of what the new tariff policy would be, the next couple of weeks in Q4FY16 will see strong order inflow.

Sales for the quarter and nine month ended December 2015 stood at 166 MW and 498 MW respectively. Minor procedural delays affected volumes for the quarter and the company expects significant pickup in sales going forward. Some components struck in customs for 7-10 days without clearance. So manufacturing, despatch and billing of about 80 MW WTG which was scheduled and site is ready for installation got shifted to next quarter. The impact of delay on top-line of Q3FY16 is about Rs 247 crore as certain part of the turbine could not be billed. Its impact also felt in the profitability of the company.

Q3FY16 has been a momentous quarter for the company with several developments that offer the company substantial long term benefits. Foremost among them is the licensing agreement with AMSC that assures continual supply and offers security in sourcing of one of the critical components of a Wind Turbine Generator.

The blade manufacturing plant (of 800 MW capacity) at the company's world-class integrated manufacturing facility in Madhya Pradesh was commissioned during Q3FY16.

The company has also further commissioned 400 MW common infrastructure facilities at Rojmal, Gujarat In January 2016. The company has also commissioned the common power evacuation facilities (200 MW) at its Nipaniya site in Madhya Pradesh. The commissioning of the common infra facilities at Lahori (200 MW+ at Madhya Pradesh) is also ready.

With significant ramp-up in execution activities going forward, the company expect growth to accelerate over the course of the remaining year.

The company has strong land bank for wind installations and the company has acquired land in AP for 4500 MW of WTG installations.

Inox Wind continues to strengthen its position and increase market share across IPPs, PSUs, Utilities, corporate and retail customers.

Renegotiated rates for components kick started in Q3FY16 onwards and the lower steel prices, which witnessed a weighted average prices was lower by 20-25% has kept the material cost lower. Higher other expenses is largely due to booking of new plant commissioning.

Q4FY16 margin will have the benefit of lower material cost, operating leverage and better mix.

The market could see 3000 MW of WTG commissioning in 2015-16 and the market may grow by 20-30% next fiscal depending on policy environ