Working Note: Adani Green Energy Restricted Group 2

Knowledge Snapshot

This file is issuer coverage memory for handoff to a new research agent. It records objective context and confirmed facts. Detailed figures are stored in data/rg2_key_metrics_20250930.json and the locally saved compliance-certificate extraction.

Last updated: 2026-06-12

Issuer Overview

• Adani Green Energy Restricted Group 2 (AGEL RG2) is a restricted group of three solar power SPVs under Adani Green Energy Limited (AGEL): Adani Renewable Energy (RJ) Limited, Wardha Solar (Maharashtra) Private Limited, and Kodangal Solar Parks Private Limited.
• The covered debt is the US$362.5mn 4.625% Senior Secured Notes due 15 October 2039, issued on 15 October 2019. Reg S ISIN is XS2057842176 and Rule 144A ISIN is US00654CAA09.
• The credit exposure is not AGEL parent-level unsecured risk. It is the cash-flow perimeter of 570MW of operating solar assets within RG2, supported by long-term fixed-price PPAs, semiannual amortisation, account controls, DSRA, DSCR/PLCR tests, and mutual guarantees among the three co-issuers.
• The end-September 2025 compliance certificate describes the current issuer names as Wardha Solar (Maharashtra) Limited and Kodangal Solar Parks Limited, while the bond documentation and SGX listing use the Private Limited names.

Core Credit View

• RG2 should be analysed as a PPA-backed, amortising project-finance-style restricted-group bond, not as a direct expression of AGEL's consolidated growth investment, Khavda expansion plan, or parent HoldCo leverage.
• Confirmed September 2025 metrics support the current debt-service profile: actual DSCR of 2.56x, FFO/net debt of 20.2%, PLCR of 2.00x, and a high share of EBITDA from NTPC/SECI-related counterparties.
• The credit remains exposed to Indian offtaker payment risk, solar resource and operating performance, USD/INR hedging, Adani group governance and legal headlines, and incomplete public information on current bond balance, market price, waiver history, DSRA coverage, and detailed covenants.

Business and Franchise View

• RG2 comprises 10 operating utility-scale solar assets with total operating capacity of 570MW. The compliance certificate allocates 200MW to Adani Renewable Energy (RJ), 350MW to Wardha Solar, and 20MW to Kodangal Solar Parks.
• The assets are supported by long-term fixed-price PPAs. Solar operations have no fuel-price risk and low variable costs, but output still depends on irradiation, equipment availability, module degradation, grid conditions, curtailment, O&M, and land or transmission constraints.
• The offtaker mix is credit-important. The September 2025 certificate shows 72.5% of EBITDA from NTPC/SECI and 27.5% from other offtakers. Public S&P information cited in the current report identifies SECI at around 73%, Maharashtra State Electricity Distribution Company at around 24%, and Bangalore Electricity Supply Company at around 3%.
• The central or policy-related offtaker share is supportive, but it is not an explicit Indian government guarantee or a sovereign-equivalent payment obligation. State DISCOM exposure remains a rating and monitoring constraint.

Capital Structure and Structural Points

• The three co-issuers jointly issued and mutually guarantee the 2039 notes. The notes are described as senior secured, and public rating information describes security, account controls, a cash-flow waterfall, DSRA, and distribution restrictions.
• Interest and principal are paid semiannually on 15 April and 15 October according to the Senior Debt Amortization Amount. This amortising structure reduces final bullet refinancing risk, but the actual remaining principal balance and period-by-period amortisation schedule still need trustee or market-data confirmation.
• The issuers directly own operating assets, which is structurally clearer than a restricted-group structure that only on-lends proceeds to operating subsidiaries.
• Ring-fencing does not fully remove group exposure. RG2 has no employees and relies on AGEL group operating and administrative support. Intragroup loans and transactions with unrestricted group entities also require ongoing review.

Liquidity and Funding View

• Liquidity should be read through project-account balances, DSRA, revenue capture, distribution restrictions, and hedging rather than simple cash alone.
• At end-September 2025, cash and cash equivalents were modest, while bank balances other than cash and cash equivalents were material and included DSRA and current-account balances.
• The financial statements state that foreign-currency borrowings are 100% hedged and that the hedge relationship is 1:1. Hedge tenor, counterparties, fair value, collateral posting, rollover costs, and continuity to 2039 remain due-diligence items.

Credit Strengths

• Operating 570MW solar portfolio with long-term fixed-price PPAs.
• Majority of EBITDA from NTPC/SECI-related counterparties.
• Amortising senior secured bond structure with account controls, DSRA, distribution restrictions, and mutual guarantees.
• September 2025 DSCR, PLCR, and FFO/net debt show current headroom on the disclosed basis.
• Direct ownership of operating assets by the issuing SPVs improves visibility to the repayment source.

Credit Weaknesses

• State DISCOM exposure remains material despite the central-related offtaker share.
• Actual generation for the 12 months ended September 2025 was slightly below P90 for the overall portfolio, although it remained above minimum PPA generation requirements.
• USD debt is serviced from primarily rupee-denominated power-sales cash flows and therefore depends on effective hedging.
• Adani group legal, governance, and capital-market headlines can affect ratings, spreads, funding access, and hedge or bank counterparties even if RG2 itself is not named in proceedings.
• Public disclosures do not yet provide the full current bond balance, market price, spread, trustee reports, full waiver history, asset-level PPA terms, or the latest full rating-agency reports.

Rating Watchpoints

• September 2025 compliance-certificate ratings: Fitch BBB-/Stable, S&P BB+/Stable, and Moody's Ba1/Stable.
• Moody's Stable outlook for RG1/RG2 was cited in December 2025 public reports and in the current report as reflecting stable operations, predictable cash flows, fully amortising debt, and ring-fencing.
• Domestic Indian ratings for AGEL or other restricted groups are supplementary only. They should not be mechanically converted into the international credit quality of the RG2 U.S. dollar notes.

Recurring Analytical Cautions

• Keep AGEL parent consolidated leverage, Khavda investment, and parent capital-market access separate from RG2's legal repayment source.
• Do not treat SECI/NTPC exposure as a sovereign guarantee.
• Do not treat ring-fencing as full immunity from Adani group market-access or governance risk.
• Do not use carrying value of the USD bonds as the current principal balance without reconciling FX translation, amortised cost, hedging, and accrued interest.
• Avoid relative-value conclusions until current outstanding amount, clean price, yield, spread, WAL, and liquidity are confirmed from market sources.

Reliable Core Sources

• SGX listing confirmation and prospectus page for the original 2039 notes.
• Offering Circular dated 2019-10-03, when accessible.
• Adani Green Energy RG2 compliance certificate and combined financial statements as at and for the twelve months ended 2025-09-30, saved locally as PDF and extracted TXT.
• AGEL investor-downloads page for future RG2 compliance certificates and financials.
• Rating agency pages or full reports from Fitch, S&P, and Moody's when directly obtainable.

Issuer Notes

This file preserves research judgment, monitoring issues, and writing cautions for future coverage. It is not a work log. Detailed figures are stored in data/rg2_key_metrics_20250930.json and in the saved compliance-certificate extraction.

Last updated: 2026-06-12

Ongoing Follow-Up Items

• Confirm the current amount outstanding, clean price, yield to worst, WAL, G-spread, Z-spread, and liquidity for XS2057842176 / US00654CAA09.
• Reconcile the Offering Circular amortisation table with trustee, DTC, or market-data balances for each semiannual principal payment.
• Obtain the latest trustee report, noteholder report, DSRA required and actual balances, distribution-test calculations, cash sweep history, and any waiver or amendment notices.
• Track DSCR, FFO/net debt, PLCR, bank balances including DSRA, trade receivables, and the cash-flow waterfall in each new compliance certificate.
• Monitor generation versus P90, P75, P50, and minimum PPA generation by SPV and by asset, especially where 12-month generation remains below P90.
• Monitor DISCOM-by-DISCOM receivables, late payment surcharge recovery, and collection days for SECI, NTPC-related counterparties, MSEDCL, BESCOM, and any other offtakers.
• Track SEC/DOJ and other Adani group legal or governance developments for possible effects on rating outlooks, market spreads, bank access, and hedge counterparties.

Unresolved Issues and Items to Check Next Time

• Individual plant names, CODs, PPA tariffs, PPA maturity dates, PPA counterparties, and PPA-by-PPA receivables were not confirmed in the current memory set.
• The detailed thresholds for distribution restrictions, additional debt, cash trap, DSCR lock-up, PLCR lock-up, event of default, and current waiver or amendment status still need full OC/trustee confirmation.
• Hedge counterparties, hedge maturity, hedge cost, collateral posting, rollover policy, termination exposure, and residual unhedged FX risk remain insufficiently verified.
• The latest full rating reports from Fitch, Moody's, and S&P have not been reviewed directly. Public rating pages, press republications, and company certificate disclosures are not substitutes for the full reports.
• Current domestic rating texts for RG2 itself, the three co-issuers, or related restricted groups need to be distinguished from AGEL parent or domestic bank-facility ratings.

Analytical Cautions

• Analyse RG2 as a restricted group of solar SPVs, not as AGEL parent. Parent-level growth, consolidated leverage, and Khavda capex are context, not the direct repayment source.
• A high DSCR does not remove the need to check generation underperformance, receivable build-up, hedge cost, waiver history, and distribution restrictions.
• The 72.5% NTPC/SECI EBITDA share is supportive but should not be written as a government guarantee.
• State DISCOM exposure remains relevant even when receivables appear manageable, because payment delays can pressure working capital and DSRA before accounting losses appear.
• Treat the company's statement that RG2 is not named in U.S. proceedings separately from possible group-wide market-access or reputation effects.

Report Wording Cautions

• Use "restricted-group bond", "project-finance-style credit", or "PPA-backed amortising secured notes" rather than "AGEL corporate bond" when describing the covered debt.
• When using ratings, state the source and subject clearly: Fitch BBB-/Stable, S&P BB+/Stable, and Moody's Ba1/Stable are for RG2-related notes as disclosed or publicly reported; AGEL domestic ratings are not direct substitutes.
• Avoid stating an actual current USD principal balance unless confirmed by trustee, DTC, Bloomberg, Refinitiv, or a current official source.
• Avoid saying that structural security assures recovery. Emphasize that recovery depends on operating cash flow, PPAs, regulatory and offtaker payments, account controls, and enforceability.

Follow-Up on Management Strategy, Investment Plans, and Financial Policy

• AGEL group strategy and funding access matter as sponsor context, but do not let AGEL's 50GW target or Khavda investments dominate RG2 bond analysis.
• Check whether intragroup loans, related-party transactions, distributions, or cash movement to unrestricted group entities change the restricted group's retained cash or creditor protection.
• Confirm whether any group-level financing, litigation, or governance development affects RG2 hedging, bank lines, rating views, or access to project-level information.

Items to Check for Ratings and Bond Investors

• Updated Fitch, Moody's, and S&P releases or full reports, including rating sensitivities and treatment of state DISCOM exposure.
• Offering Circular and Note Trust Deed provisions for collateral, guarantee limits, account waterfall, sweep, distribution restrictions, change of control, additional debt, events of default, and enforcement.
• Market level and liquidity by Reg S and Rule 144A lines.
• Latest compliance certificate, including whether DSCR/PLCR remains stable, whether generation underperformance persists, and whether receivables or hedge-related liabilities increase.