Suzlon Group, India’s largest renewable energy solutions provider, has recently inked a definitive agreement with REC Limited, a state-run entity, for crucial working capital facilities. This strategic partnership is geared towards bolstering Suzlon’s capacity to meet its working capital needs, pivotal for executing its extensive current order book and prospective future projects.
Suzlon Group, a global player in the renewable energy sector, boasts an impressive 20.3 gigawatts (GW) of wind energy capacity across 17 countries. With operations spanning across 14 manufacturing facilities in India, the company is on a mission to expand its reach and efficiency in the renewable energy landscape.
In recent years, Suzlon faced challenges in securing adequate working capital, hindering its ability to scale up operations and grow its order book. The new financial arrangement with REC Ltd is viewed as a significant relief and a reflection of Suzlon’s enhanced financial stability.
REC Ltd, classified as a ‘Maharatna’ company and under the administrative purview of the Ministry of Power, specializes in providing long-term financial solutions, including loans, to entities in the country’s infrastructure sector. This partnership signifies a renewed collaboration, as REC Ltd has played a crucial role in aiding Suzlon’s past endeavors, including debt refinancing, ultimately contributing to Suzlon achieving a debt-free status.
The current working capital facility provided by REC Ltd is non-fund based, maintaining Suzlon’s status as a debt-free entity. Mody emphasized that this off-balance sheet facility would significantly improve commercial terms with customers and suppliers. The rolling nature of this facility allows Suzlon to execute current and future orders from its esteemed customers.
Suzlon anticipates that these working capital facilities will not only accelerate its operational activities but also optimize the use of its existing capacities. This, in turn, will enable faster ramp-up of operations and better utilization of installed capacities, addressing the challenges the company faced in increasing volumes and expanding its order book in recent years.
Suzlon Group is a leading renewable energy solutions provider globally, with a diverse portfolio and a significant presence in wind energy. Headquartered in Pune, India, the Group has over 28 years of operational track record and a workforce of over 6,000 employees.
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