Azure Power Global Limited (AZRE) Q4 2021 Earnings Call Transcript

Azure Power Global Limited (AZRE -13.04%)
Q4 2021 Earnings Call
Jun 16, 2021, 8:30 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Ladies and gentlemen, good day and welcome to the Azure Power fiscal fourth-quarter 2021 earnings conference call. [Operator instructions] Please note that this conference is being recorded. I'll now hand the conference over to Mr. Vikas Bansal from Azure Power.

Thank you, and over to you, sir.

Vikas Bansal -- Investor Relations

Thank you and good morning, everyone, and thank you for joining us. On Tuesday evening, the company issued a press release announcing results for the fourth fiscal quarter of 2021 and on March 31, 2021. A copy of the press release and the presentation are available on the Investors section of Azure Power's website at azurepower.com. With me today are Ranjit Gupta, CEO; Murali Subramanian, COO; and Pawan Kumar Agrawal, CFO.

Ranjit will start the call by going through recent key highlights, Murali will then follow up with an update on our projects under construction, technological innovation, and an industry update. Pawan will then provide an update on the quarter with additional discussion on the performance of the quarter. And then we will wrap up the call with Ranjit updating FY '22 guidance and providing Quarter 1 FY '22 guidance. After this, we will open up the call for questions.

Please note, our Safe Harbor statements are contained within our press release, presentation materials, and available on our website. These statements are important and integral to all our remarks. These are risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements. So, we encourage you to review the press release we furnished in our Form 6-K and presentation on our website for a more complete description.

Also contained in our press release, presentation materials, and annual report are certain non-GAAP measures that really coincide to the most comparable GAAP measure. And these reconciliations are also available on our website, in the press release, and presentation materials, and annual report. It is now my pleasure to hand it over to Ranjit.

Ranjit Gupta -- Chief Executive Officer and Director

Thank you, Vikas, and a very good morning, everyone. I would like to start today's call offering condolences to everyone impacted by COVID. We faced the pandemic's ugliest face in India during April and May 2021 when almost no family was left untouched in some way or the other by COVID. The good part is that we are now seeing daily infections recede and our vaccination day has picked up the pace with over 260 million doses administered to date.

At Azure, we have stood by our employees and stakeholders in the fight against the pandemic and have been following all COVID protocols with vigor. During the second wave, we undertook a number of initiatives to supplement the medical infrastructure in and around the areas we operate. We donated 30-plus oxygen concentrators to healthcare facilities in the states of Rajasthan, U.P., Karnataka, and other states. Supplied 30 BIPAP machines to a healthcare facility at Bikaner, supplied oximeters, PPE kits, masks, and other essential medical items to a number of facilities as per their requirement.

Within the company, to help our team members, we strengthened our preparedness to respond to medical emergencies faced by our employees or their family members by implementing a cohort-based support group, procurement of 15 oxygen cylinders distributed across our various sites, and purchasing a number of oxygen concentrators for our own use placed at strategic locations. We continue to retain the support of a qualified medical practitioner for any medical advice to our employees and their family members. We have also implemented a company-subsidized term insurance scheme to support the economic needs of our families in case of any unfortunate event. I am especially proud of the cohort-based group wherein we created a pyramid of contacts, thereby reaching out to every team member every day to track their and their family's health, providing help where needed.

The way the team came together on several occasions to help a team member in his or her hour of need was exemplary and truly demonstrated the strength of Azure. Sustainability and ESG are key to the success of our business at Azure. We highlighted our ISO-45001 certification last quarter, which demonstrates Azure's focus on occupational health and safety, and validates additional efforts we put in to make our workplaces safe for our team members and contractors. In December, MSCI, the leading ESG rating agency, rated Azure Power as double AA for ESG, which places us in the top quartile of all global utilities they cover, and probably among the highest ratings among our peers in the country.

We continue to strive toward improving further on this rating. I am happy to report that we have entered into an agreement to sell our Rooftop Portfolio to Radiance Renewables for an enterprise value of approximately US$73 million. This is the first-ever asset sale in Azure Power's history and signifies our commitment toward capital discipline, while recycling capital into higher-return committed projects. Continuing with this philosophy, I am happy to report that Azure is seeking to increase the size of our addressable market by foraying into other areas of renewable energy, especially wind and solar/wind hybrid projects.

We have participated in a couple of auctions already and will look to have something more concrete sooner than later. As the share of renewable energy in the grid increases, we realize that the business will move toward more dispatchable energy. As the industry moves toward providing firm power to the grid, wind and storage will be two important technology additions we have to plan for our portfolio. I had mentioned in my previous remarks how Green Hydrogen and plummeting storage costs have the potential to disrupt our industry.

We are in the process of critically examining our business and growth strategy as we go along our endeavor to be on the right side of the evolving renewable industry landscape. We are continuously evaluating, deploying new techniques and technology at our projects to improve returns. We assure our valued investors that we will continue to be disciplined in our approach and will keep all of you posted as we take steps in this territory. Today, we have 20% more MWs operating than we did at the same time last year, excluding the Rooftop portfolio.

Our operating assets have performed well and not only have we been able to continue collecting revenues during this pandemic, we even improved our collections with our DSO at 116 days at the end of the quarter, compared to 122 days at the same time last year. We have controlled our costs and our cash G&A, excluding stock compensation expenses and one-time expenses in the previous period, increased marginally by 8% from the same quarter last year. We have promised to reduce our cash G&A expenses by 10% in fiscal year '21 versus fiscal year '20, and I am happy to report that we have reported a reduction of 26% in G&A from the previous period, excluding the impact of stock appreciation rights. Growth and our actions to improve returns have resulted in a 23% year-on-year increase in EBITDA from operating assets and a 75% increase in cash flow to equity from operating assets.

Since we started reporting CFe, we have seen a steady improvement in this metric due to our focus on setting our assets, capex infusion in operating assets, reducing our costs, and collection of long outstanding dues. On the flip side, despite significant progress made prior to the second wave of COVID toward signing Power Purchase Agreements on our 4 GW for which we have a letter of award but no PPAs, we have not much to report yet. We still remain optimistic that we will have positive news to deliver shortly as there is a definite movement toward the finish line. In spite of the pandemic, peak power demand recovery is under way, which should encourage DISCOMs to invest in buying power for their future needs.

It may be noted that there is a backlog of 15-20 GW awarded capacity, which is awaiting PSA to be tied with the DISCOMs. SECI has been supportive by not coming out with any new solar ISTS bid till this backlog is cleared. As the second wave has eased, we have seen renewed interest in buying power from DISCOMs. We have also seen global polysilicon prices escalate in the recent past and it has impacted our supplies and our commissioning timelines.

We continue to monitor the situation and are hopeful that the recent increase in prices is only temporary. The government continues to support the renewable energy sector. The Honorable Prime Minister recently reiterated the government of India's commitment to climate actions at the G7 Summit, and he has been the driving force behind India's vision of 450 GWs renewable energy operational by 2030. Apart from the push on setting up generation assets, the government has been talking about promoting Make in India.

There has been a talk of measures to encourage solar cell and solar panel manufacturing domestically. Two important measures were announced in the last few weeks to enable local manufacturing industry. First was the imposition of basic customs duty from April 1, 2022, with 40% on modules and 25% on cells. The other was the notification of the ALMM list, which is the approved list of models and manufacturers.

Any project auctioned after April 10, 2021, will necessarily have to buy solar panels that appear on ALMM list. Our current pipeline will continue to enjoy the benefit of pass-through since our projects were auctioned before the imposition of both these notifications. Further, as per a recent judgment by the Honorable Supreme Court of India, all transmission lines in certain regions of Rajasthan and Gujarat have been asked to be converted from overhead wires to underground. We believe this would be cost-neutral to us as we should be allowed to pass-through of the same if we incur the costs.

Given the turmoil of the last years, FY '21 -- fiscal year '21 has been all about efficiency and prudence. We have invested in our operating projects to improve generation and living facilities of our team members at site. We are moving rapidly to deploy the latest bifacial modules and trackers to increase the efficiency of insolation capture on our projects which are going into construction. If I look back at this difficult year, some of our achievements are that we were able to keep operating through the various lockdowns and pandemic surges, the work we were able to do to support our teams and our communities, that we were able to largely protect returns on our under-construction projects through COVID-induced delays, the sale of the Rooftop assets, and the patience we have shown by staying away from the temptation of bidding aggressively through the year have been huge successes and very satisfying.

With almost two years behind me, I look forward to the coming fiscal with great hope and optimism. We believe in waiting for the right opportunity to earn our shareholders a return higher than our cost of capital and the philosophy of building a sustainable business rather than simply chase scale. We continue to look for suggestions from our investors and stakeholders on how we can further improve our disclosures and make it easier for you to understand our business. With that, I would like to turn it over to Murali.

Murali Subramanian -- Chief Operating Officer

Thank you, Ranjit. On Page 5, we provide an update on our projects under construction. The second wave of COVID at its peak, severely impacting our construction activities, not only disrupting the supply chain but also impacting several of our sites. High local demand for solar modules in the past several months or so in China, coupled with a rising yuan and rising raw material costs has resulted in module suppliers trying to renegotiate their contracted price and delivery commitments despite signed supply contracts.

The module prices for new orders are at levels that were last seen years ago. We had anticipated earlier that by fiscal year-end, in our Rajasthan 600-megawatt project, we would operationalize 450 megawatts, and the final 150 megawatts finished by May. However, as of today, we have finished 300 megawatts in FY 2021, and 300 megawatts have been pushed by another quarter due to the second COVID-wave-related challenges. Thanks to the Ministry of New and Renewable Energy notification, however, granting extensions to all projects with a commissioning due date of April 1, 2021, we don't expect to incur any penalties for delays.

Project construction work in Assam has picked up after poor weather and COVID-related delays. However, the second wave of COVID came in strongly and it has again taken a hit.  After the initial 25-megawatt commissioned, we commissioned another 12.5-megawatt project in May and expect another 12.5 to be done shortly. The entire project is expected to be fully commissioned by the end of the calendar year as we're already in the midst of the monsoon season now. We have sought a commercial operation date extension from the regulator and procurer for getting an extension until the end of this financial year -- this calendar year.

As mentioned in the past, we have made several incremental improvements in operations and construction practices to squeeze out better returns. Our recently operationalized analytics platform has been instrumental in identifying faults quicker, leading to lower downtime at the string level. Our ability to target, determine, and rectify electrical losses during operations has also been enhanced considerably. On the construction side, we are installing tracker-based systems in one of our projects under construction to combat the impacts of increased panel prices.

We have provided some highlights of our ESG accomplishments on Page 6. As Ranjit mentioned earlier, we have got a strong AA rating from MSCI for ESG and obtained ISO-45001 certification, which verifies that Azure Power provides a safe and healthy workplace. Our carbon-free generation has avoided about 3 million tons of CO2 equivalent this fiscal, bringing the total to 9.5 million tons equivalent since inception. We remain net carbon neutral.

We have been focusing on our water neutrality, having installed 84 groundwater recharge structures across 15 sites this fiscal. And other environmental focus this year is safe disposal, even recycling whenever possible of damaged modules. And we have made very good progress this fiscal year that 555 tons of modules were disposed. We also remain actively engaged with the communities in which we operate with support toward medical and health facilities and active response on the pandemic front.

On the governance side, we are already complying with the World Bank equator principles and governance standards of NYSE, SEC, and SGX. The majority of our directors on the board are independent and would increase gender diversity. During the fiscal, we introduced policies for human rights and equal employment opportunity along with diversity and inclusion, which highlights our efforts toward upholding the highest governance standards. We are continuously striving to implement best practices to enhance our sustainability.

Looking at industry and regulatory updates on Page 7, there is a buildup of allocated solar projects with letters of award but without power purchase agreements at the moment. In the last couple of quarters, the distribution companies have not been signing PSAs, and this has been accentuated by the second COVID wave and falling tariffs. However, our discipline has protected us from entering at the recently bid out low tariffs. We expect developers may find it difficult to build projects at the recently bid out low tariffs, given the rising input costs coupled with COVID-related delays.

The good news is that overall power demand in India is expected to grow now as the country emerges from the second wave. With the challenges in supplies and pricing, we do expect that there should be an increase in tariffs, compared to the ones discovered in the recent past. However, we've all been surprised, and we should see how tariffs turned out. We have seen that there have been series of intense competitions followed by moderation.

We are pursuing new opportunities such as wind and hybrid, and we assure that we shall only bid for projects at commercially viable tariffs. We continue to believe that we would be able to obtain the 4-gigawatt PPAs at value accretive tariffs, which would add to our contracted pipeline and provide returns above the cost of capital. With that, I would turn it over to Pawan to discuss the quarterly results. Thank you.

Pawan Kumar Agrawal -- Chief Financial Officer

Thank you, Murali. Turning to Page 9. As of March 31, 2021, we were operating 1,990 megawatts on a PP or EC basis, which is 20% higher than what we were operating a year before. Our portfolio of 6,955 megawatts remained stable from the previous quarter, excluding the rooftop portfolio.

Since our last update, we have entered into a definitive agreement to sell our rooftop portfolio and have, therefore, excluded these assets from our portfolio. Our construction costs have continued to fall in FY '21 and were about 19% lower than the previous year. Turning to Page 10. Looking at the quarter, our revenues continue to increase as we can sell more projects, some of which have been affected by the second wave of COVID and supply related challenges on the module front as noted by Murali.

After adjusting for stock compensation expenses, our EBITDA has been 44.3 million, or 18% higher, against 16% increase in revenues from the same quarter in the prior year. Turning to G&A on Page 11, cash costs were below our internal expectations, save for stock appreciation rights or SAR, which added about 18 million to G&A for the year. Our cash G&A costs were below internal expectations. We remain very focused on reducing our costs as we have outlined earlier this year and are pleased to report that our G&A was 26% lower than the prior year.

We are looking now to FY '22. We expect that cash G&A will rise about 10% from FY '21 level, primarily reflecting inflation and an increase in megawatts in operation.  We are also progressing well on the refinancing of our US$185 million long-term debt facilities outside bond pool, as well as US$500 million green bonds RG1. We expect substantial savings in interest costs once these refinancings are completed. Turning to stock compensation expenses.

As the sale price rises, our stock compensation expenses will rise, inflating our G&A. To help with modeling, the impact of SAR expenses on our G&A is directly linked to the sale price. For the fourth quarter of '21, we had a reversal in expense of around 7.7 million, primarily reflecting a reduction in share price from US$40.77 as of March 31, 2020, to US$27.19 as of March 31, 2021. Going forward, for every US$1 change in stock place above and below our previous quarters, we'll have about 800,000 impact, both positive and negative.

We are particularly proud of our ability to improve our DSO despite the challenges this year. Our fourth-quarter '21 DSO was 116 days, which is better than the 120 days about a year ago. We continue to make progress in collecting our payments and believe there will be further improvement in the future with the commissioning of projects with high credit-worthy counterparty this year. On Page 12, you can see that EBITDA from operating assets increased about 18% year on year and that cash flow to equity from operating assets rose about 55%.

Net debt for operating assets was about 1.13 billion, and EBITDA for the last 12 months was about 179 million, resulting in a net debt-to-EBITDA ratio for our operating assets of about six times, which is better than last year's result of 6.6 times. Finally, looking at Page 13, providing balance sheet information, we had about 152 million of cash and cash equivalents and our net debt stood at approximately 1.19 billion. As a reminder, for those that are calculating our debt ratio, the hedging assets of 75 million included in the other assets on our balance sheet should be netted against our total debt as this is directly linked to the foreign exchange hedges we put in place related to our green bonds. Now, I pass onto Ranjit to provide some commentary on our guidance.

Ranjit Gupta -- Chief Executive Officer and Director

Thank you, Pawan. In February 2021, when we had reiterated our revised guidance for fiscal year '21, I had mentioned the caveats of timely commissioning, normal weather, and no curtailment. We are 1.5% lower on our Q4 revenue and 0.5% lower on our fiscal-year '21 revenue, compared to our projected number, primarily reflecting lower insolation due to weather conditions. Even though we have just started in the recovery path from the second wave, as of now, we would reiterate our numbers for the current fiscal but will keep the markets posted in the upcoming updates.

For the first quarter of fiscal '22, we expect revenue to be between INR 4,100 million and INR 4,300 million, and the PLF to be between 23% and 24%. With this, we will be happy to take questions. 

Questions & Answers:

Operator

Thank you very much. [Operator instructions] Our first question is from the line of Philip Shen from ROTH Capital Partners. Please go ahead.

Philip Shen -- ROTH Capital Partners -- Analyst

Hi, everyone, thank you for taking my questions. The first one's on the SECI 4 gigawatts. I know you gave some color in your prepared remarks and in your release. I was wondering if you might have a better sense of when the first tranche might get placed.

What's the timing of when the agreement could be signed there? Thanks.

Ranjit Gupta -- Chief Executive Officer and Director

Thanks, Shen, for the question. So like you mentioned, right, there is some progress over the last two to three weeks. In fact, a couple of hearings that were scheduled in the regulatory commissions actually happened over the last couple of weeks. And you know, we are happy here that those hearings went well.

So we are hopeful that we are in the middle of June, so we're hopeful that within the next four weeks, we should get something signed off the first tranche. If not the whole thing, at least it will -- the signings will begin within the next four weeks as what we are told by SECI. 

Philip Shen -- ROTH Capital Partners -- Analyst

Great, Ranjit. Thanks. Have they, by chance, been able to share with you preliminarily how much lower the tariffs could come down by or could be? Do you think it'll be 25% below where you thought -- I mean, I think you expect the tariffs to come at lower, but how much lower do you think they could be? Thanks.

Ranjit Gupta -- Chief Executive Officer and Director

So like we have said in the past, the tariff has to make sense for us. Otherwise, we will not sign. This is an option that is available to us, and we can hold on to the option for more time. There is no reason for us to go out and sign because like we have mentioned and we have spoken in the past, the status that has been discovered in the last three or four months or six months, has been super competitive and we don't believe that we would have liked to participate in the market at those steps.

And our dividend has actually been so great because the markets have moved in the wrong direction where tariffs or status are concerned. So -- and we had the option at some point to, you know, to look at the tariffs that were discovered and sign positive agreements close to those tariffs. And we had a decline at that point saying that those tariffs are not appropriate in our view, and we would rather wait for the correct status. So at the moment, you know, what has been -- what is being discussed is maybe a, you know, a 10, 15% kind of a reduction from status, but the final numbers will be known only when we get the regulatory approval, then SECI signs power sale agreements with the distribution company.

But rest assured that we have declined in the past to sign when the tariffs did not make sense, and we will continue to do that. Still, that status makes sense for us.

Philip Shen -- ROTH Capital Partners -- Analyst

Great. Thank you for that color, Ranjit. And then on the call earlier, you mentioned the potential to get into wind and storage. I was wondering if you might be able to share a little bit more on the timing of when something could be announced and what the structure of that opportunity might look like.

Thanks. 

Ranjit Gupta -- Chief Executive Officer and Director

Phil, that's a very important question, and that's -- you know, thanks for asking. Because wind and wind hybrid, currently, what is happening is a bit odd. It's still stand-alones, very small storage standards, which are more exploratory in nature than commercial in nature. So we have looked at some of them.

We have not yet taken part in any of those auctions because they're very small and exploratory like I said. However, as wind and solar-wind hybrid projects are concerned, they are very established. Wind has been around in India for more than 25 years. So, therefore, it's a well-established market.

And Murali and I have the experience of building more than one gigawatt of wind in our previous life. So, therefore, you know, we are very, very comfortable with wind options, and wind projects, and wind construction, and wind operation. So we have taken part in an auction for wind and an option for solar-wind hybrid in the last six months. And there are a couple of auctions coming up over the next -- we understand, in the next four to six weeks.

So we will take part in those auctions. And if -- again, if we find that the right tariffs, we will certainly, you know, like to win one of those auctions and win both those auctions, and build out, you know, the first wind or wind/solar hybrid projects for Azure.

Philip Shen -- ROTH Capital Partners -- Analyst

Great. Well, one last question, if I may, as it relates to, I think, trackers. You mentioned that you use your -- use trackers recently to offset the panel price increases. Looking ahead, do you expect the trackers to be -- first of all, which tracker did you use? And then also, do you expect the share of trackers in your projects to increase meaningfully? And if so, could it be something like 50% of your installations, or do you think it stays at a meaningful small percentage.

Thanks.

Murali Subramanian -- Chief Operating Officer

Ranjit, do you want me to take it?

Ranjit Gupta -- Chief Executive Officer and Director

Yes, please.

Murali Subramanian -- Chief Operating Officer

Right. So, you know, every project has to be evaluated at its merit, right? So currently, given the panel crisis, there is merit in considering tracker. So we are doing that for one of our projects as mentioned. Depending on the tariff, depending on the location, depending on several other inputs, each project will be evaluated to determine whether a tracker-based system makes sense or the traditional fixtures makes sense.

And on that basis, we will decide. So it would be hard for us to sort of peg a percentage for the future. In terms of which tracker, I think we had this conversation in the past as well where we are looking at a range of companies. So we are looking at three different companies and each of them is getting some portion of the contract going ahead.

And these are the big names which are there. One of them is American, one of them is Chinese, one of them is Indian. 

Philip Shen -- ROTH Capital Partners -- Analyst

OK. Great. Thanks for the color. I'll pass it on.

Operator

Thank you. [Operator instructions] The next question is from the line of Maheep Mandloi from Credit Suisse. Please go ahead.

Maheep Mandloi -- Credit Suisse -- Analyst

Hey. Hello, everyone. Thanks for taking the questions. Ranjit, maybe one clarification on the FY 2022 guidance of 17.9 billion to 18.9 billion rupees of revenues.

Could you clarify whether that includes rooftop or not? Because I think in the April press release, you had reduced it by around 700 million rupees, sort of some clarification on that.

Ranjit Gupta -- Chief Executive Officer and Director

So in the current numbers, the -- you know, we have included the -- I'm not sure if you said -- the -- you're talking about the 17.9 billion and 18.9 billion that we have mentioned, right?

Maheep Mandloi -- Credit Suisse -- Analyst

Yeah, that's right, yeah. The 17.2 billion and 18.2 billion in the April press release when you announced the sale of the rooftop portfolio. 

Ranjit Gupta -- Chief Executive Officer and Director

Pawan, would you be able to take this?

Pawan KumarAgrawal

Sure. So the next-year guidance, Maheep, that excludes rooftop revenues if this is -- if I understood your question correctly. It excludes rooftop revenue.

Maheep Mandloi -- Credit Suisse -- Analyst

So the 700 million fire -- increased revenues versus the guidance from April press release, I just want to clarify that. That's a result of just more projects coming online earlier than expected or something else on that? 

Pawan KumarAgrawal

Yeah. So also, see, Maheep, that we have qualified in our 6-K that these projects, because of second wave of COVID, are getting slightly delayed. And of course, MNRE is also considering extension. So as we stand today, we are not in the position to kind of ascertain with a reasonable certainty what exactly would be the [Inaudible] of these projects.

So that is the reason we have very confidently qualified in our 6-K that we will be assessing how the commissioning will happen. And possibly, maybe in the next quarter, [Technical difficulty] projects, we'll be able to tell what would be -- if we need to modify the annual guidance.

Maheep Mandloi -- Credit Suisse -- Analyst

Got it. All right. You know, follow-up, Ranjit, on nature on you with that. And maybe just another question from my side is just the -- as maybe just looking at the capex for a new solar project in this quarter, it seems pretty low compared to what we had in the last quarter and last year, at least 10% lower.

My -- how do you expect that to trend for the rest of the projects under construction just given module prices have increased of late? Do you expect any risk to it, any kind of -- any cancellation and strong the module suppliers, anything like that impacting the capex in the near term?

Murali Subramanian -- Chief Operating Officer

Well, you know, very good question. So we have negotiated module supply agreements and signed supply contracts with several manufacturers and suppliers. Some of them are being discussed and negotiated because there has been a rise in input costs, and we understand that. And this is work in progress.

In some cases, we have sort of agreed to a marginal increase. In some cases, the increase is a little more than margin. So those are still under discussion. Having said all of this, if we were to build a new project today, I'm not talking about the projects which are already under construction which we have spoken off in this release but any new bid that I'd go for.

If I put a new bid takes today's panel prices, then the project cost would go up by about 10%. However, that's not something that would impact us directly for the projects under construction because we have contracts signed at low panel prices and there is a little bit of discussion around those very specific numbers.

Maheep Mandloi -- Credit Suisse -- Analyst

Right. That makes sense. Thanks for the clarification. And then maybe just leave one high-level question here and maybe, Ranjit, this is for you.

So we have seen a couple of assets exchange hands recently in the Indian market. And I think even today, international developer with Indian operation was taken private. So I guess to that -- keeping that in mind, like are you seeing any interest in privatization or any -- an interest from other entities just given the valuation and the equity markets doesn't seem to reflect the opportunity ahead of you, especially, in my opinion, doesn't even include the four gigawatts of projects, which, as said, the PBS could renegotiate in the next month or so.

Ranjit Gupta -- Chief Executive Officer and Director

All right. This is a very difficult question to answer. At the moment, there is no talks with that regard between shareholders, you know, about taking the company private. And we have seen the share price in the last few months reflect what was perhaps closer to the true value of the company.

And at the moment, there has been a pullback in the -- by the clean energy market and sustainable stocks. So I think this is a -- this is perhaps potentially I believe a temporary phenomena, and we will see the -- you know, the share price reflect the true value sooner than later. I am more confident of that today than I was about a year back. Today, if you see our liquidity, right? I mean, we are trading -- when we joined the company, we were trading 10,000 shares a day.

Previous trading, you know, over 300,000 shares a day. Yesterday, we traded over half million shares. So with that kind of liquidity, there does come a little bit of volatility. But the trend, I believe, is going to be positive.

And, you know, public markets in the U.S. are a brilliant place in my opinion. And the -- we hope to stay public. 

Maheep Mandloi -- Credit Suisse -- Analyst

Yes, thanks for taking the questions.

Operator

Thank you. [Operator instructions] The next question is from the line of Puneet from HSBC. Please go ahead.

Puneet Gulati -- HSBC -- Analyst

Yeah. Thank you so much. Good evening, everybody. My first question is with respect to the overall cost.

In your presentation, you talked about your cost -- [Inaudible] cost falling to $0.39-plus in FY '21 from $0.49 in FY '20. Where do you think will these costs go for FY '22? 

Murali Subramanian -- Chief Operating Officer

Again, when you say these costs, you're talking about Azure-specific projects, right? 

Puneet Gulati -- HSBC -- Analyst

Yes. 

Murali Subramanian -- Chief Operating Officer

It would trend up perhaps by, you know, a few percent, not much. But again, you know, these are early days because these projects are under construction, and this is a constant negotiation and discussion with our suppliers. So, you know, I can't predict what might happen four weeks or eight weeks from now. That would be speculative.

But given where we are, we -- because we've already signed a lot of our contracts, there is some renegotiation happening. On that basis, we could probably estimate a few percent increase. But again, I don't know what would happen eight months down or 12 months down. 

Puneet Gulati -- HSBC -- Analyst

OK. If I were to resume this current, how do you measure then -- where should this trend? 

Murali Subramanian -- Chief Operating Officer

If you were to look at the current module prices and you go for a sort of new project with, you know, a lot of other input costs have also increased. So if you look at all of that, one would reckon about a 10% increase as I mentioned. 

Puneet Gulati -- HSBC -- Analyst

Thirty-nine could become potentially 43 [Inaudible]. 

Murali Subramanian -- Chief Operating Officer

Yeah, and I just add 10%. But again, you know, the important number here, you know, cost per megawatt is one metric. Perhaps the more relevant metric would be cost per million units, right? Because if you are introducing trackers, using other newer technology to improve yield, then the amount of energy generated per dollar of investment is probably more relevant as opposed to amount of megawatts installed. So that may come into consideration once you deployed better and newer technologies. 

Puneet Gulati -- HSBC -- Analyst

And so the 10% you're including the cost of trackers and better modules? 

Murali Subramanian -- Chief Operating Officer

No. So that is -- it's -- you know, it's very difficult. There are so many moving parts in our project cost, so depending on the choice of tracker, depending on the choice of modules, the choice of technology of the module itself. So all of them will impact the cost.

So the endeavor is to get the lowest cost of energy as opposed to the lowest capex per megawatt. What I have indicated in terms of 10% is, you know, like for like, all else being equal, no change in technology, no change in anything, purely on account of cost increase on like-for-like items. However, if you go for better technology, you may pay more, but you might get better yields, right? So that's a constant evaluation we do.

Puneet Gulati -- HSBC -- Analyst

Thanks. My second question is how much of the capex was capitalized in the current year? 

Pawan Kumar Agrawal -- Chief Financial Officer

Yeah. So if you look at our balance sheet slide, the PP&D has gone up from INR 95,993 million to INR 108,847 million. So that delta is something that has been capitalized if you compare March '20 versus March '21.

Puneet Gulati -- HSBC -- Analyst

Yeh. So -- and if I look at your capex, it is roughly, you know, INR 18 billion, but what is being commissioned is probably half that number. 

Pawan Kumar Agrawal -- Chief Financial Officer

Right, right. Because commissioning typically, we have to incur a lot of costs which remains in CWIP, and then we commission. So again, if it is in CWIP, it is capitalized, right? So that is the way we reported capex, yeah. 

Puneet Gulati -- HSBC -- Analyst

So INR 13.5 billion ballpark number was what you would have capitalized adjusting for all these?

Pawan Kumar Agrawal -- Chief Financial Officer

Sorry, 13.5? 

Puneet Gulati -- HSBC -- Analyst

INR 13.5 billion would be the cost capitalized for 369 [Inaudible]. Is that the right comparison?

Pawan Kumar Agrawal -- Chief Financial Officer

So maybe, we'll have to check the breakup exactly how much of the total capex is capitalized and how much is [Inaudible]. The right number is not with me. But definitely, this is a total increase in gross [Inaudible] part of which is on commission project and part of which is still under construction. And therefore, they're not comparable vis-a-vis commissioning.

Puneet Gulati -- HSBC -- Analyst

OK. So I can take that later with you. My last question, Ranjit, is for you. So you have still four gigawatts under negotiation in terms of tariff.

So on the current module prices, do you think 2.93 is a number which you will be comfortable with? Or do you think you could still take something lower, or you need to take a higher tariff?

Ranjit Gupta -- Chief Executive Officer and Director

Certainly, Puneet, the current prices that exist all indications, if you talk to the polysilicon suppliers, we talk to the wafer suppliers, we talk to the sales supplier, we talk to the module suppliers. Indications are that this is very temporary. And, you know, indications are that this is easing out or starting to ease out already and that, you know, the module manufacturers are seeing inventory buildup. And so, therefore, we don't believe that this is a continuing trend, let's say, for example, if the price today is X, like Murali mentioned, around 10% higher, that tomorrow, it will be 15% or 20% higher.

That is not the expectation. You know, we expect that normal service is going to resume in the next few weeks, and we will see a steady moderation in the price of modules as we go toward the end of the year or beginning of next year. So if we sound like I'm saying that in four weeks or six weeks' time, we are -- you know, if we are lucky enough to get some of our power purchase agreements signed, those power purchase agreements will need to be delivered by contract two years from now. This means that we are going to be buying modules for those contracts only six quarters hence.

So there is plenty of time. We do not expect that the module prices will rise in this period from the current prices to higher numbers. We do believe that they will moderate. We don't believe that in this quick time in the next four to six quarters, we believe that it is perhaps not possible to see numbers that happened just post COVID, right, then suddenly the prices dropped from pre-COVID levels.

But I would not be surprised if we are able to see pricing, which is pre COVID levels sooner than later, I think, over the next three, four quarters, we should be able to come back to pre-COVID levels at least is our expectation. But of course, you know, it's a crystal ball to some extent, but this is what the market seems to be suggesting. This is what the market seems to be telling us.

Puneet Gulati -- HSBC -- Analyst

OK. My last question, just if I may, you know, on your sale of Rooftop subsidiary, do you see any bottlenecks to that sale because there seems to be some sort of, you know, comments that say that Radiance -- you need to reimburse Radiance if the asset transfer does not go on. Any major hurdle that you're looking at [Inaudible]?

Ranjit Gupta -- Chief Executive Officer and Director

So, Puneet, the Radiance team is super excited about this portfolio. They've got a great deal. We've got a great deal. It's a transaction where buyer and seller are both happy.

So they are already, you know, engaged with us. They have a very good operating team, and we are very confident that they, you know, they will make a success of this portfolio, perhaps even better than what we have done. And, you know, they seem to be very motivated and committed. So we don't believe that there will be any issues.

There are always issues in getting some of the PPAs approved, some take a bit longer, some are a bit faster. But -- and you know how unlike, you know, this is 150-odd megawatt portfolio. If it was a ground-mount portfolio, it would be one power purchase agreement. In case of Rooftop, it stands a power purchase agreement, right? And therefore, you know, it does take time to get all the approvals and all the sign-off.

And so that's why we have said that it will take till September. When we mentioned about the contract terms that you have specifically referred to, those are contract terms because, obviously, you know, there will have to be some contract protection for both sides in a situation when things goes out. And therefore, we have been transparent in what their contract conditions are. But there is obviously no clear because both the buyer and the seller are motivated to make this transaction a success. 

Puneet Gulati -- HSBC -- Analyst

Yeah. But you're still -- you have to get paid for [Inaudible]? 

Ranjit Gupta -- Chief Executive Officer and Director

Yes, of course. I mean when the transaction closes then we get paid. 

Puneet Gulati -- HSBC -- Analyst

Understood. Thank you so much. 

Operator

Thank you. The next question is from the line of Elvira Scotto from RBC Capital Markets. Please go ahead.

Elvira Scotto -- RBC Capital Markets -- Analyst

Hi, everyone. I just wanted some clarification on the fiscal year 2022 guidance. So in terms of that guidance, what is embedded in the guidance, you know, relative to your projects under construction. So what is the timeline for completion for each project that's embedded in your full fiscal year guidance? 

Ranjit Gupta -- Chief Executive Officer and Director

Hi, Elvira. So, yes, you know, if you look at our presentation, the earnings presentation, if you go to Slide 5. It was I think on Slide 5, which is the projects under construction update. We have mentioned how the 950-odd megawatts are likely to be commissioned, which is the second half of the Rajasthan 6 project, a Rajasthan 8 project, and Rajasthan 9 project, and the Assam project.

So this, you know, these 950-odd megawatts that, you know, will get added to our capacity in this time. So if [Inaudible] we do only this, we don't do any other -- you know, we don't do anything else, then we should be seeing us at our guided number by the end of this fiscal. So this is what is, in our case, in our belief, this is say the worst-case scenario for us.

Elvira Scotto -- RBC Capital Markets -- Analyst

OK. The reason I'm asking is I believe you've pushed out 300 megawatts on Rajasthan 6 by one quarter. So I'm just trying to understand how you can still maintain the same fiscal year guidance when you've actually pushed out the timeline on 300 megawatts?

Ranjit Gupta -- Chief Executive Officer and Director

So the reason, Elvira, is that it was supposed to be done by May of 2021. That means we should have completed the second 300 megawatts by now. So, you know, that is not going to happen. Obviously, it has not happened.

We are in June already. So we expect that it will get done in the next quarter. But the next quarter is still part of this fiscal year. So whatever push has happened on these projects, there have been a slight push on each of the projects that is there compared to last time on account of the fact that we practically did very little work over the month of April and May and partly in June.

So, therefore, the fact that we could not do much work in these two, two and a half months as there was -- was going to the second pandemic wave. So because of that, everything has been pushed back a little bit. But we still expect that all of these projects will get done in this fiscal year. And that's the reason why the, you know, why the target is the same.

The reason there has been a change between our guidance from February to now is that we've just corrected the guidance for the sale of the Rooftop projects. Earlier, we had included the Rooftop projects. Now, we have taken those Rooftop projects out. Otherwise, as far as the ground-mount portfolio is concerned, there is no change as far as the fiscal is concerned.

Elvira Scotto -- RBC Capital Markets -- Analyst

OK. And then just to -- sorry to keep asking on this. But just to clarify, so the fiscal-year guidance, is that the amount that you expect in this year? Or is it a run rate amount exiting fiscal year '22? 

Ranjit Gupta -- Chief Executive Officer and Director

This is the installed capacity as of 31st of March 2022.

Elvira Scotto -- RBC Capital Markets -- Analyst

OK. OK. That's helpful. And then just in terms of -- on the hybrid projects and the wind projects, how are you thinking about returns on those projects relative to returns on solar-only projects? 

Ranjit Gupta -- Chief Executive Officer and Director

So the market is fairly mature on both the solar wind and wind hybrid -- solar-wind hybrid side. So we expect similar returns on whether we do solar or wind hybrid. The technology is fairly well known. The players are very well known, the risks are very well known.

So, therefore, we don't expect there to be a differential in the return. What -- how it helps us really is in two ways. It helps us because it increases our addressable market, you know, because of the fact that earlier we were taking part only in solar auctions and now we'll take part in wind and wind hybrid, wind/solar hybrid auctions also. So it increases our ability to win projects.

And the second thing it does help us in is because this is where the technology is headed. We are looking at higher penetration of renewable energy in the grid. And as we have seen across the world, when that happens, you know, the grid managers have difficulty. And slowly, it's moving toward dispatchable renewable energy.

And when you do dispatchable renewable energy, that can typically happen only with some sort of storage, whether it's in battery storage or mechanical storage, or pump storage, or whatever the storage facility might be. And for storage facility to work, you need to typically manage the storage in the morning peak hours and in the evening peak hours. So the evening peak hours typically get filled, the storage gets filled by solar. And the morning is filled by wind because typically in India, the solar energy gets, you know, gets dispatched during the day, whereas wind is largely in the night.

So that, you know, you can actually use the same sort of storage system and use it once in the evening and once in the morning. So, therefore, wind is a very important ingredient for the dispatchable power to be successful in India, and we need to be in that space.

Elvira Scotto -- RBC Capital Markets -- Analyst

OK. Great. Thank you very much.

Operator

Thank you. As there are no further questions, I would now like to hand the conference over to the management for closing comments. 

Ranjit Gupta -- Chief Executive Officer and Director

Thank you, everyone. Thanks for participating in our conference call, and we look forward to seeing you again. We are always available. Vikas Bansal is available any time for more questions, more comments, and for any one-to-one discussions that you might, you know, want to have with us for clarity in anything that you might want clarity on.

So we look forward to interacting with you more and have a great week ahead. Thank you. 

Operator

[Operator signoff]

Duration: 62 minutes

Call participants:

Vikas Bansal -- Investor Relations

Ranjit Gupta -- Chief Executive Officer and Director

Murali Subramanian -- Chief Operating Officer

Pawan Kumar Agrawal -- Chief Financial Officer

Philip Shen -- ROTH Capital Partners -- Analyst

Maheep Mandloi -- Credit Suisse -- Analyst

Pawan KumarAgrawal

Puneet Gulati -- HSBC -- Analyst

Elvira Scotto -- RBC Capital Markets -- Analyst

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