Issuer Summary: Adani Renewable Energy (RJ) Limited / ARENRJ

Date prepared: 2026-05-22
Issuer: Adani Renewable Energy (RJ) Limited
Ticker: ARENRJ
Effective credit exposure: AGEL Restricted Group 2 / 570MW solar power asset pool
Covered bond: Adani Renewable Energy (RJ) Limited, Kodangal Solar Parks Private Limited and Wardha Solar (Maharashtra) Private Limited 4.625% Senior Secured Notes due 15 Oct 2039

1. Business Snapshot and Recent Developments

Adani Renewable Energy (RJ) Limited (“ARENRJ”) is not a conventional operating-company bond issuer of Adani Green Energy Limited (“AGEL”) itself. It is an Indian solar power SPV used as the displayed issuer for the U.S.-dollar green bond of AGEL Restricted Group 2 (“RG II”). The credit exposure investors should focus on is not the standalone corporate credit of ARENRJ, but the 570MW solar power asset pool comprising ARENRJ, Kodangal Solar Parks Private Limited and Wardha Solar (Maharashtra) Private Limited. The Offering Circular dated 3 October 2019 describes a structure under which these three companies issued USD 362.5mn of 4.625% Senior Secured Notes due 2039. Subsequent RG II financials also use the names Kodangal Solar Parks Limited and Wardha Solar (Maharashtra) Limited. However, this note has not verified legal evidence of a formal name change; it therefore uses the legal names as of the OC and treats the subsequent naming differences in the financials as documentary presentation differences.

For this bond, it is insufficient to look only at AGEL’s consolidated revenue, consolidated leverage and 50GW growth plan. The direct source of repayment is the electricity sales revenue generated by the solar power plants within the restricted group under PPAs, together with project account controls, DSCR, DSRA, scheduled amortisation, collateral, and cross-guarantees among the co-issuers. AGEL is important in the context of sponsorship, operating platform, capital market access and reputational incentives. However, under the OC, the bond should not be treated as explicitly guaranteed by AGEL or by an Adani Group sponsor. If this point is misread, investors may think they are buying an AGEL parent bond while in fact holding an amortising restricted-group bond with a strong project-finance character.

The basic terms of the covered bond differ materially from a standard bullet-maturity corporate bond. Interest payment dates are 15 April and 15 October each year, and a portion of principal is repaid on each interest payment date according to the Senior Debt Amortization Amount. Credit risk therefore should not be assessed only by reference to the final maturity in 2039. Investors need to monitor semi-annual cash flow, scheduled principal repayment, DSRA, hedging, and receipts from offtakers. At issuance, the ECB regulatory allocation was stated as 69.2% for Wardha Solar, 27.7% for ARENRJ and 3.1% for Kodangal Solar, meaning Wardha has the largest substantive share of the assets and cash flow. For investor-facing purposes, however, ARENRJ is referenced as the displayed issuer, and the cross-guarantees among the three companies sit at the core of the structure.

The most recent direct information identified is AGEL’s RG II compliance certificate and financials for September 2025. In that document, DSCR is shown at 2.53x and FFO/net debt at 20.2% for the calculation period from October 2024 to September 2025. The same document shows senior secured indebtedness of INR 26,234mn, DSRA of INR 1,600mn, derivative hedge inflow accounts of INR 3,694mn, and total permitted investments and project account balances of INR 7,700mn. These figures show that RG II is not simply a credit in the parent company’s name, but a bond managed through restricted-group cash flow and account structures. However, INR 26,234mn is the senior secured debt balance in the compliance certificate and is not necessarily the current nominal principal amount of the 2039 notes themselves. The current outstanding balance of the 2039 notes after scheduled amortisation has not been verified as of this note.

Separately, on 24 April 2026, AGEL released its FY2026 results and stated that, at the parent level, its renewable energy operating capacity was 19.3GW, power supply revenue was INR 11,602 crore, power supply EBITDA was INR 10,865 crore, and the power supply EBITDA margin was 91%. AGEL’s scale expansion, operating capability and capital market access are positive in the sponsor context. These, however, are not the direct repayment source for the ARENRJ bond. The larger AGEL’s growth becomes, the deeper the sponsor’s operating base becomes, but the group’s overall investment scale, governance, external funding environment and reputational risk may also feed through into RG II bond spreads and rating sensitivity. This note therefore uses AGEL’s results as supplementary information, while placing the centre of the credit assessment on RG II’s contractual cash flow and bond structure.

2. Industry Position and Franchise Strength

RG II’s business base lies less in the growth of the Indian renewable energy market itself than in contractual revenue from solar power assets backed by long-term PPAs. In solar power, credit quality is driven by resource availability, plant load factor, transmission constraints, O&M, module degradation and offtaker payments. This is not a business that directly captures rising power prices; it recovers cash flow based on PPA tariffs and contractual terms and applies that cash flow to scheduled debt service. The focus of credit analysis is therefore not “a company riding India’s renewables growth,” but “how steadily existing contracted assets can support debt service through 2039.”

India’s solar power sector benefits from policy tailwinds and room for scale expansion, but it also faces state DISCOM payment delays, grid constraints, regulatory changes, land, connection and weather risks. For a restricted-group bond such as RG II, the fact that the generation assets are operational and backed by long-term PPAs is a major support. However, credit quality cannot be assessed merely by noting that the assets are “renewable”; investors need to examine PPA counterparties, payment history, receivables ageing, generation performance and DSCR headroom. AGEL parent-level materials disclose PPA ratios and operating capacity for the overall renewables portfolio, but for the RG II bond, the restricted group’s offtaker mix and cash-flow ring-fencing are more important.

The September 2025 RG II materials show, for the purpose of the Pool Protection Event test, that 72.54% of EBITDA was attributable to sovereign counterparties. This level indicates that a meaningful portion of PPA revenue is supported by central-government-related or similar counterparties. However, the remaining portion may depend on state DISCOMs or other counterparties, so the central-counterparty share does not eliminate the collection risk of the overall pool. DISCOM receivables are generally a key issue in the power-sector credit analysis, and any delay would feed into DSCR, working capital, distribution capacity and hedge-cost burden.

AGEL group’s operating platform is an indirect support for RG II. AGEL states that, as of FY2026, it had a 19.3GW operating portfolio and was one of India’s largest renewable energy companies. A large portfolio, centralised monitoring, O&M, procurement and construction know-how improve operating execution for the individual SPVs. However, operating capability and debt guarantee are separate concepts. RG II bond investors can give credit to AGEL’s operating platform as a form of credit support, but their legal repayment claims are limited to the restricted group’s obligors, guarantees, collateral and account structure.

3. Segment Assessment

RG II is a restricted group comprising three solar SPVs. Rather than analysing the revenue mix of multiple business segments as with a conventional operating company, the key is to confirm each SPV’s allocation, PPA, offtaker, collateral and cross-guarantee position. In the issuance OC, the three companies are co-issuers, while under the ECB framework each company has its own allocation. ARENRJ is the displayed issuer, but Wardha Solar is the core of the asset pool. Investors therefore need to look not only at the single name ARENRJ, but also at the combined cash flow of the three companies.

PPA details are an area that investors should verify further. Based on the OC review, Kodangal Solar has a 20MW solar project, a 25-year PPA with BESCOM and a tariff of INR 5.48/kWh. For Wardha Solar, the OC confirms multiple PPAs with SECI, projects including 40MW and 50MW, and a tariff of INR 4.43/kWh. For ARENRJ on a standalone basis, the capacity by PPA, tariff and counterparty-specific collection status have not been sufficiently organised from the public information reviewed for this note. These contracts are the foundation of the project bond in the sense that tariffs are fixed and cash flow is generated according to generation volume and collection.

The important point in this table is not merely that PPAs exist, but the route by which PPA revenue reaches bond payments. The power plants need to operate, offtakers need to pay, receivables need not to accumulate, revenue needs to enter the project accounts, and the waterfall needs to allocate funds to operating expenses, taxes, hedging, debt service and the DSRA. Even with long-term PPAs, DSCR can deteriorate quickly if there are payment delays, transmission constraints, generation shortfalls or higher hedge costs.

4. Financial Profile and Analysis

RG II’s financials should be read as special-purpose restricted-group financials, not as consolidated financial statements of a listed company. The September 2025 RG II financials are combined financial statements under Indian accounting standards and treat the three companies as a single restricted group. This is useful for bond analysis, but legally each company exists separately and is subject to the allocation and guarantee/collateral provisions in the OC. The financial data therefore shows RG II’s combined repayment capacity and is not a complete set of standalone financial statements for ARENRJ.

For the 12 months to September 2025, RG II reported power supply / operating revenue of INR 4,962mn, other income of INR 1,870mn, and adjusted operating revenue of INR 6,861mn after adjustments including VGF / GST claim recoveries. EBITDA was INR 6,372mn, calculated after deducting operating expenses and non-recurring items. The point to note here is that the DSCR calculation uses an adjusted figure that includes not only power sales revenue, but also other income and claim recoveries. Investors need to distinguish recurring power-sale revenue from interest income, related-party fund deployment income, government subsidies and change-in-law claims.

The 2.53x DSCR is supportive of the credit as a disclosed metric as of September 2025. However, it is premature to infer payment safety through 2039 from this figure alone. First, DSCR is a historical 12-month calculation and does not fully capture future irradiation, generation, payment delays, transmission constraints, hedge costs, taxes or changes in scheduled amortisation. Second, the numerator, cash flow available for debt service, is also affected by income and adjustments other than actual power sales revenue. Third, as scheduled amortisation reduces debt, hedge, regulatory, PPA collection and equipment-degradation factors will matter in other ways. DSCR is therefore a strong starting point, but it needs to be read alongside PPA-level collection, generation performance, DSRA, distribution restrictions and hedging.

Receivables were INR 492mn as of September 2025, down from INR 618mn as of March 2025. The RG II financials state that the main receivables are from central and state DISCOMs and related parties, and that late-payment interest is contractually applicable in the event of delays. This is supportive from a credit perspective. From an investor’s perspective, however, the age and counterparty of receivables matter more than the aggregate amount. Payment delays from state DISCOMs are a typical risk in the Indian power sector. If receivables rise sharply, cash headroom for debt service can shrink even when accounting revenue is recognised.

On liquidity, the DSRA of INR 1,600mn and the various project accounts and investment balances of INR 7,700mn are important. However, these are not all the same type of cash. The September 2025 project-account breakdown shows, among other items, ARENRJ’s operating account at INR 1,021mn, ARENRJ’s DSRA at INR 410mn, ARENRJ’s hedge inflow account at INR 1,034mn, Wardha’s operating account at INR 1,194mn, Wardha’s DSRA at INR 1,140mn and Wardha’s hedge inflow account at INR 2,547mn. This indicates that revenue is subject to a certain degree of account control within the group. On the other hand, the extent to which hedge inflow accounts and other permitted investment balances can be used directly for the next debt service payment depends on use restrictions and the waterfall. The actual balance relative to the required DSRA amount, and whether there is any shortfall before the next debt service date, need to be further verified through the relevant certificates and trustee materials.

A further financial constraint is the intermittent nature of information disclosure. RG II is not an issuer that provides detailed quarterly results in the same way as a listed company. Investors need to piece together AGEL’s investor downloads page, SGX disclosures and rating-agency materials. As of 22 May 2026, the latest RG II financials directly verified for this note are those for September 2025, and FY2026 RG II financials have not been verified. Because of this limitation, AGEL’s April 2026 parent-level results do not by themselves disclose RG II’s latest DSCR, receivables, DSRA coverage or debt balance.

5. Structural Considerations for Bondholders

The most important issue for this bond is where the credit is ring-fenced. Under the OC, the Notes were issued by Adani Renewable Energy (RJ) Limited, Kodangal Solar Parks Private Limited and Wardha Solar (Maharashtra) Private Limited, and each company obtained a separate Loan Registration Number under the ECB regulations. In Euroclear, Clearstream and other display systems, however, ARENRJ is referenced and Kodangal and Wardha are treated as co-issuers. This means that even if investors see the name ARENRJ on screen, the actual credit analysis should be conducted on the combined restricted group of the three companies.

Each company guarantees the payment obligations of the other issuers. This provides structural support by allowing the cash flow of one SPV to support another SPV if part of the pool underperforms. However, this is not a guarantee from AGEL or the sponsor. The cross-guarantees among the co-issuers are horizontal support within the same asset pool; they do not give investors direct recourse to the parent company or to the assets and cash flow of the wider group. It would therefore be incorrect to treat this bond in the same way as a senior bond of AGEL itself merely because AGEL as a group is growing or reports a high EBITDA margin.

Collateral is also important, but the existence of collateral should not be simplified into certainty of principal recovery. Under the OC, the Security Interests for the Notes are not granted directly to the Noteholders, but are enforced through the Security Trustee and the Note Trustee. In addition, collateral enforcement, acceleration and allocation of proceeds are subject to prescribed procedures and priority rules under the Security Trustee and Intercreditor Deed. Following enforcement, proceeds are distributed in an order that includes costs of the Security Trustee, Note Trustee and others, enforcement costs, interest, premiums, hedge-related payments and principal. Bondholders benefit from protection, but they are not in a position to enforce collateral directly and individually.

The account waterfall and covenants are also central for bondholders. In project bonds, the key issue is not whether the company can use funds freely, but into which account electricity-sale revenue is deposited, in what priority it is allocated, and under what conditions distributions are restricted. The RG II materials show DSCR, FFO/net debt, Pool Protection Event, permitted investments, DSRA and hedge inflow accounts. These mechanisms protect debt service more directly than the liquidity and financial restrictions typically analysed for conventional corporate bonds.

For investors, the key lens is going-concern project value rather than collateral value. If solar power plants are enforced upon and sold, the process involves legal procedures, Indian collateral enforcement, power-plant operations, PPA transfer, grid connection, regulatory approvals and the existence of buyers. The centre of recovery is not liquidation value, but the project continuing to operate, PPA revenue entering the accounts as scheduled and amortisation progressing. The secured label is important, but the first items to analyse are generation, collection and DSCR.

6. Capital Structure, Liquidity and Funding

RG II’s capital structure includes the U.S.-dollar bond issued at inception, onshore related debt, project accounts, hedging and related-party transactions. The September 2025 RG II financials show the carrying value of borrowings at INR 30,595mn and the senior secured debt balance in the compliance certificate at INR 26,234mn. In the FFO/net debt calculation, net debt is calculated by deducting various reserve accounts and the DSRA from the senior secured debt balance. Public figures are insufficient to fully recalculate the current nominal principal of the 2039 notes or the breakdown including other senior debt. At a minimum, however, the debt balance and account balances need to be analysed together because this is a scheduled-amortisation project bond.

The bond is denominated in USD, while revenue is mainly INR-denominated PPA revenue. Currency risk is therefore an important structural issue. The September 2025 RG II financials state that foreign-currency borrowings are 100% hedged. This is a major support, but the maturity, counterparty, collateral posting, hedge costs, unwind gains or losses, and the ability to maintain a full hedge through 2039 require separate verification. Even if hedges are in place, higher hedge costs or collateral requirements could affect liquidity in the project accounts.

On interest-rate exposure, the issued bond has a fixed coupon of 4.625%, and the financial statements also describe fixed-rate debt as the main component. Rising U.S.-dollar interest rates do not immediately raise the coupon, but they may affect hedge renewal, future additional debt, refinancing, rating-agency assessment and market prices. Because the bond has scheduled amortisation, refinancing dependence is lower than for a conventional long-dated bullet bond. However, given the long remaining period to 2039, hedging and capital market access remain monitoring items.

For liquidity, the nature of restricted accounts needs to be confirmed rather than focusing only on cash and deposits. Cash and cash equivalents were small at INR 198mn as of September 2025, but bank balances other than cash equivalents were INR 3,838mn, investments were INR 1,487mn and other financial assets were INR 980mn. In addition, restricted project accounts and permitted investment balances totalled INR 7,700mn. These are not freely available cash and are likely subject to use restrictions for debt service, DSRA, hedging, operating accounts and similar purposes. Investors should therefore ask not “whether cash is high or low,” but “which accounts can be used for the next debt service payment, DSRA requirement, distribution restrictions and hedge requirements.”

The September 2025 materials state that there were no financial covenant breaches. This is an important comfort factor. However, covenant compliance is point-in-time information. The situation could change if receivables rise, generation underperforms, hedge costs increase, intra-group loans or distributions occur, or regulatory changes arise. In project bonds, a credit deterioration often develops not through a single major event, but through several periods of receivables accumulation or DSRA drawdowns, leading to distribution stoppage, downgrade pressure and spread widening.

7. Rating Agency View

AGEL’s official USD Bond Credit Ratings page shows ratings of S&P BB+, Fitch BBB- and Moody’s Ba1 for the USD 362.5mn USD Green Bonds of Restricted Group 2 (570MW). This rating configuration places RG II at the boundary between low investment grade and upper high yield. Fitch is at the lowest investment-grade level, while Moody’s and S&P rate the bond below investment grade. The same bond is therefore viewed differently by different rating agencies.

Rating supports include contracted solar PPAs, operational assets, scheduled amortisation, DSCR, DSRA, collateral, public-sector characteristics of offtakers and AGEL’s operating platform. Constraints include Indian offtaker payment risk, absence of a parent guarantee, spillover from group governance and capital market access, foreign-currency debt, hedging and limited disclosure. The rating information verified for this note is limited to the three ratings shown on AGEL’s official page. Details of rating rationales, upgrade and downgrade sensitivities, latest outlooks and the details of past S&P outlook changes remain items for follow-up verification.

When reading the ratings, it is important not to transfer AGEL parent-level ratings or views of the wider group directly to the ARENRJ bond. RG II’s ratings are based on PPA cash flow within the restricted group, debt structure, DSCR, collateral, hedging and project risk. AGEL’s large-scale growth can be positive in terms of operating capability and sponsor-support incentives. At the same time, the group’s funding needs, governance and legal risks may also affect market perception. Rating-agency views should be read with these two aspects separated.

8. Credit Positioning

The ARENRJ / RG II bond is relatively close to a traditional restricted-group renewable energy project-bond structure in India: “operational solar assets + long-term PPAs + scheduled amortisation + collateral + DSRA.” When comparing it with Indian renewable project bonds such as Clean Renewable Power, Greenko, Continuum and SAEL, the first comparison points should not be sponsor name, but asset operating status, PPA counterparties, DSCR, timing of debt amortisation, DSRA, foreign-currency hedging, distribution restrictions, current balance and remaining tenor.

RG II’s relative strengths are that it is a scheduled-amortisation bond that should have amortised since its 2019 issuance, that DSCR was shown at 2.53x as of September 2025, that the sovereign PPA EBITDA ratio was 72.54%, and that Fitch shows a BBB- rating. From a project-bond perspective, principal reduction over time is an important protection and reduces the single refinancing risk associated with long-dated bullet bonds.

The relative constraints are that market valuation is sensitive to governance and reputational risk related to AGEL and the Adani Group, that there is no parent guarantee, that the latest RG II financials are not available as frequently as AGEL parent-level results, and that FY2026 RG II financials have not been verified as of this note. In addition, the 2039 maturity is long and, despite the amortising structure, investors remain exposed for a long period to the Indian power sector, DISCOM collection, hedging and group capital market access.

This note has not verified current price, yield, spread, WAL or outstanding balance. It therefore does not make a buy/sell or cheap/rich judgement. An actual investment decision requires comparing current spread, remaining tenor, amortisation schedule and liquidity against other Indian renewable restricted-group bonds, other AGEL-related RG bonds, Asian infrastructure bonds in the same rating band and amortising project bonds with similar tenor. What this note can state is that, in terms of credit quality, the bond should be positioned not as an AGEL parent bond, but as a project bond dependent on an operating solar PPA asset pool.

9. Key Credit Strengths and Constraints

The first credit strength is contractual cash flow from solar assets backed by long-term PPAs. RG II is a 570MW solar asset pool and generates electricity sales revenue under contracts. The fact that revenue is centred on payments from PPA counterparties rather than merchant generation directly exposed to market power prices improves visibility for debt service.

The second support is the scheduled-amortisation debt structure. The final maturity in 2039 implies a long duration if viewed only by final redemption date, but principal is designed to decline on each interest payment date. If amortisation proceeds as scheduled, outstanding principal and risk exposure decrease over time. This enhances project-bond conservatism relative to conventional bullet-maturity corporate bonds.

The third support is the DSCR and account balances verified as of September 2025. DSCR of 2.53x, FFO/net debt of 20.2%, senior secured debt of INR 26,234mn in the compliance certificate, DSRA of INR 1,600mn and project account / investment balances of INR 7,700mn indicate debt service capacity at that point in time. Receivables were also INR 492mn, not an extremely large amount relative to revenue scale.

The fourth support is the cross-guarantees and collateral among the co-issuers. Compared with each of the three companies bearing debt separately on a standalone basis, the presence of restricted-group cross-guarantees, collateral and account control provides investor protection. Enforcement through the Security Trustee, account waterfall, DSRA and Pool Protection Event are structural protections not found in ordinary unsecured corporate bonds.

The largest constraint, however, is the absence of a parent guarantee. AGEL’s scale, growth, operating capability and capital market access are important, but investors do not have direct recourse to the assets of AGEL itself or the Adani Group sponsor. Sponsor support may be expected as an incentive to protect reputation and capital market access, but it should not be assessed as a legal obligation.

The second constraint is offtaker payment risk. Central counterparties such as SECI are relatively strong, but payment delays from state DISCOMs are a structural monitoring item in the Indian power sector. If receivables increase and DSCR becomes weaker on a cash basis than accounting earnings suggest, debt service headroom may deteriorate faster than it appears.

The third constraint is currency and hedging. The September 2025 financials state that foreign-currency borrowings were 100% hedged, but given the long-dated nature of the bond through 2039, hedge continuity, costs, counterparties and cash burden upon termination need to be monitored continuously. The combination of INR revenue and USD debt is manageable only if the hedging continues to function.

The fourth constraint is intermittent disclosure. AGEL parent-level results are relatively easy to obtain, but RG II investors need restricted-group financials, DSCR, DSRA, PPA collection, outstanding balance, amortisation schedule and hedging. If these are available only semi-annually or irregularly, the information gap itself can become a spread-widening factor during market stress.

10. Downside Scenarios and Monitoring Triggers

The most realistic downside scenario is a gradual deterioration in generation or collection over several periods, eroding DSCR and account headroom. For solar assets, lower irradiation, equipment problems, module degradation, O&M issues and transmission constraints affect generation. If this is combined with payment delays from state DISCOMs, revenue may be recognised in the income statement while cash entering project accounts is delayed, pressuring DSCR, DSRA and distribution capacity.

The second downside scenario is deterioration in the quality of the offtaker mix. The sovereign PPA EBITDA ratio was 72.54% as of September 2025. If this ratio declines and approaches the tests related to Pool Protection Event, distribution restrictions, additional debt constraints and downward rating pressure could intensify. Investors need to verify EBITDA and CFADS by PPA, the ratio to SECI, and receivables by state DISCOM.

The third downside scenario is hedging and foreign-currency risk. As long as hedging is maintained, the currency risk of the USD bond is managed. However, higher hedge costs, weaker counterparty credit, or requirements for termination payments or collateral posting would reduce headroom in project accounts. For a long-dated bond, a hedge is not a one-off solution; it involves continuing costs and contractual risk.

The fourth downside scenario is spillover from governance, legal risk or reduced capital market access across the wider Adani Group into RG II’s market valuation. RG II’s direct repayment source is solar PPA cash flow, but the market may at times view Adani-related issuers as a group. Sponsor-support expectations, hedging and banking relationships, investor demand and rating-agency views can be affected by group-level credit events. This should be treated not as an issue of legal repayment source, but as an issue of market access and reputation.

The fifth downside scenario is a situation in which the effectiveness of collateral and enforcement is tested. In project bonds, collateral cannot necessarily be converted immediately into cash for full recovery upon default. The process involves Security Trustee procedures, directions from other creditors, PPAs, transmission, land, regulatory approvals and the existence of buyers. Collateral may support recovery rates, but the best protection is not enforcement; it is the normal-course flow of PPA cash as scheduled.

Monitoring items are FY2026 or the next RG II financials, DSCR, FFO/net debt, PLCR, actual DSRA balance and required amount, receivables by PPA, generation and operating performance, sovereign PPA ratio, hedge balance and maturities, current outstanding balance, scheduled amortisation history, any waivers or amendments, and rating actions. If DSCR decline, a sharp increase in receivables, DSRA shortfall, higher hedge costs and a negative rating outlook occur at the same time, the credit view on the bond could deteriorate relatively quickly.

11. Credit View and Monitoring Focus

Based on public information through September 2025, the current credit quality is appropriately assessed as that of a project bond at the boundary between low investment grade and upper high yield. The credit trajectory appears closer to stable than to rapid deterioration, based on DSCR, account balances, scheduled amortisation and AGEL’s operating platform as of that date. However, because FY2026 RG II direct financials, current outstanding balance, PPA-level collection and hedge details have not been verified, investors should not conclude that the credit quality level or direction is unlikely to change quickly. The view should be updated relatively promptly when new information becomes available.

The core credit support is the contractual cash flow of the 570MW solar asset pool. Long-term PPAs, a sovereign PPA ratio of 72.54%, DSCR of 2.53x, FFO/net debt of 20.2%, DSRA, scheduled amortisation, collateral and cross-guarantees provide clearer project-finance protections than an ordinary unsecured corporate bond. In particular, the semi-annual reduction of principal lowers future bullet refinancing risk.

At the same time, investors’ risk derives from dependence on restricted-group cash flow rather than AGEL parent credit. There is no parent guarantee and no direct recourse to AGEL or the sponsor, so PPA collection, generation volume, DSCR, DSRA, collateral enforceability and hedging are fundamental. AGEL’s FY2026 results are useful as supplementary information for assessing the sponsor’s operating capability and market access, but they are not the direct source of repayment for the ARENRJ bond.

No investment conclusion should be reached before price and spread are checked. From a credit perspective alone, RG II has multiple supports that make it a relevant project-bond candidate, but investors bear long-dated exposure through 2039 to Indian DISCOM collection, hedging, group spillover and information constraints. The bond may be worth considering on credit grounds, but pricing and relative value remain unverified. Conversely, it should not be purchased with the same recovery expectation as a parent senior bond merely because of AGEL’s growth or the group name.

The highest-priority next verification items are FY2026 RG II financials and the latest compliance certificate. These should be used to confirm DSCR, PLCR, FFO/net debt, DSRA, receivables, PPA-level collection, current outstanding balance, amortisation performance, hedging and covenant compliance. Next, full latest reports from Fitch, Moody’s and S&P should be obtained to verify rating sensitivities and outlook rationales. Finally, market price, yield, WAL and spread comparison with peer bonds should be reviewed to connect the credit view to an investment decision.

12. Short Summary & Conclusion

Adani Renewable Energy (RJ) Limited / ARENRJ is not a senior bond issuer of AGEL itself, but the displayed issuer of a USD-denominated secured and scheduled-amortisation project bond backed by AGEL Restricted Group 2’s 570MW solar asset pool. Credit quality depends less on AGEL consolidated financials than on long-term PPAs, offtaker collection, DSCR, DSRA, account waterfall, cross-guarantees and collateral structure. The September 2025 disclosed metrics show a degree of headroom, but there is no parent guarantee. Investors should verify FY2026 RG II financials, current outstanding balance, PPA-level collection, hedging and market spreads before making an investment decision.

13. Sources

1. SGX, Adani Renewable Energy (RJ) Limited listing prospectus page, U.S.$362,500,000 4.625% Senior Secured Notes due 2039, 3 Oct 2019.
   https://links.sgx.com/1.0.0/prospectus-circulars/35742

2. SGX, Offering Circular for Adani Renewable Energy (RJ) Limited, Kodangal Solar Parks Private Limited and Wardha Solar (Maharashtra) Private Limited, dated 3 Oct 2019.
   https://links.sgx.com/FileOpen/Shreya%20II%20-%20eFINAL.ashx?App=Prospectus&FileID=40150

3. Adani Green Energy Limited, Investor Downloads page, RG II Financials & Compliance Certificate section.
   https://www.adanigreenenergy.com/investors/investor-downloads

4. Adani Green Energy Limited, RG II Compliance Certificate and Financials September 2025.
   https://www.adanigreenenergy.com/-/media/Project/GreenEnergy/Investor-Downloads/RG-II-Financials--Compliance-Certificate/RG-2-CC-set-signed-comp.pdf

5. Adani Green Energy Limited, USD Bond Credit Ratings page.
   https://www.adanigreenenergy.com/investors/usd-bond-credit-ratings

6. Adani Group / Adani Green Energy Limited, Adani Green Energy delivers highest ever greenfield annual capacity addition of 5.1 GW, reports 23% YoY growth in core EBITDA at Rs 10,865 crore, 24 Apr 2026.
   https://www.adani.com/newsroom/media-releases/adani-green-energy-delivers-highest-ever-greenfield-annual-capacity

7. Adani Green Energy Limited, FY26 Earnings Presentation, 24 Apr 2026.
   https://www.adanigreenenergy.com/-/media/project/greenenergy/investor-downloads/result-presentation-dynamic/q4-fy26.pdf

8. Adani Green Energy Limited, FY26 Fixed Income Earnings Conference Call Transcript, 24 Apr 2026.
   https://www.adanigreenenergy.com/-/media/project/greenenergy/investor-downloads/results-conference-call-transcript/adani-green_q4fy26_debt-call_transcript_apr-24-2026_vf.pdf

9. Latham & Watkins, Latham & Watkins Advises Adani Green Energy on its US$362.5 million Co-Issuer Green Bond Offering, 22 Oct 2019.
   https://www.lw.com/en/news/2019/10/latham-advises-adani-on-362million-co-issuer-green-bond-offering

14. Unverified / Pending

• FY2026 or the latest RG II compliance certificate and financials.
• Current outstanding balance of the 2039 notes, scheduled amortisation progress, WAL, price, yield and spread.
• Latest full reports from Fitch, Moody’s and S&P, rating sensitivities and outlook rationales.
• Generation volume, availability, PLF, receivables ageing, payment delays and recovery of late-payment interest by PPA.
• DSRA required amount versus actual balance, and cash bridge to the next debt service date.
• Hedge contract maturities, costs, counterparties and potential burden upon termination.
• Any waivers, amendments, cash traps, distribution restrictions or covenant breaches after September 2025.
• Full text and sensitivities of the latest rating actions by each rating agency, including past S&P outlook changes.
• Market-valuation impact on RG II bonds from AGEL- and Adani Group-related legal, governance and capital market access events.