RG II remains comfortably inside every disclosed financial trigger. The September 30, 2025 compliance certificate shows 2.53x DSCR against the 1.55x full-distribution threshold, 20.2% FFO / Net Debt against the 6.0% restriction trigger, 2.00x PLCR against the 1.60x debt-sizing floor, and 72.5% EBITDA from sovereign-equivalent counterparties against the 65.0% minimum. Versus March 31, 2025, ratio quality improved on three of four metrics, but prudent distributable cash tightened from INR 1,196 Mn to INR 671 Mn.
Honesty clause. RG II covenant thresholds and mechanics are documented in the Note Trust Deed dated October 15, 2019, but the full trust deed is not staged in this repo. This report is derived from the March 2025 and September 2025 compliance certificates plus the September 2019 RG II roadshow. That means the covenant numbers are company-certified and authoritative, while some structural detail is thinner than a full trust-deed read.
Executive Summary
Distribution Status
FULLY OPEN
DSCR remains above the 1.55x no-restriction threshold.
Prudent Distribution Cash
INR 671 Mn
Down from INR 1,196 Mn at March 31, 2025 after larger working-capital uses and earmarked debt service.
Transfer to Distribution Account
INR 2,351 Mn
Before earmarking INR 1,680 Mn for debt service, capex, and one month of O&M.
Portfolio Mix
72.5%
EBITDA from sovereign-equivalent counterparties, above the 65% covenant floor.
Financial Matrix
| Metric | Actual | Threshold | Status | What it means |
|---|---|---|---|---|
| Debt Service Coverage Ratio RG II compliance certificate p. 8 — "the Debt Service Cover Ratio for the Calculation Period ended on the relevant Calculation Date was 2.53:1." Trend: 2.61x at March 31, 2025 -> 2.53x at September 30, 2025. Down modestly from 2.61x at March 31, 2025, but still well above all lock-up triggers. | 2.53x | >= 1.55x | OPEN | Maximum distribution level remains open; below 1.55x distributions step down to 60%. |
| FFO / Net Debt RG II compliance certificate p. 9 — "FFO / Net Debt ... 6.0% ... 19.0% ... 20.2%" Trend: 19.0% at March 31, 2025 -> 20.2% at September 30, 2025. Improved versus March 2025. | 20.2% | >= 6.0% | OPEN | General distribution restriction stays off; below 6.0% distributions are restricted to 75% of cash otherwise available. |
| Project Life Cover Ratio RG II compliance certificate p. 9 — "Project Life Cover Ratio (PLCR) ... 1.60 ... 1.95 ... 2.00" Support: RG II roadshow p. 17 — "Any breach will result in 100% lock up of distributions and excess cash flow being transferred to SDRA account" Trend: 1.95x at March 31, 2025 -> 2.00x at September 30, 2025. Improved versus March 2025. | 2.00x | >= 1.60x | OPEN | Debt sizing covenant is in compliance; below 1.60x distributions lock 100% and excess cash sweeps into the SDRA until compliance is restored. |
| EBITDA from Sovereign Equivalent Counterparty RG II compliance certificate p. 9 — "EBITDA from Sovereign Equivalent Counterparty ... 65.00% ... 72.09% ... 72.54%" Support: RG II roadshow p. 17 — "At least 65% of Total EBITDA from Sovereign Equivalent Off-takers" Trend: 72.1% at March 31, 2025 -> 72.5% at September 30, 2025. Improved slightly versus March 2025. | 72.5% | >= 65.0% | OPEN | Sovereign-counterparty mix stays compliant; breach would weaken the debt-sizing covenant and the off-taker quality support package. |
Distribution Lock-Ups
| Trigger | Outcome | Source |
|---|---|---|
| DSCR > 1.55x | No restriction on distribution | RG II roadshow p. 20 |
| DSCR < 1.55x | Distributions restricted to 60% | RG II roadshow p. 20 |
| DSCR < 1.45x | Distributions restricted to 50% | RG II roadshow p. 20 |
| DSCR < 1.35x | No distribution | RG II roadshow p. 20 |
| DSCR < 1.10x | Event of default | RG II roadshow p. 20 |
| FFO / Net Debt < 6.0% | General distribution restricted to 75% | RG II roadshow p. 20 |
| PLCR < 1.60x or debt-sizing covenant breach | 100% lock-up plus cash sweep / debt reduction via the SDRA | RG II roadshow p. 17 |
How to read this. RG II is governed by a project-finance waterfall, not a general unsecured incurrence covenant package. DSCR governs the percentage of distributable cash that can leave the structure, FFO / Net Debt adds a separate 75% restriction trigger, and the PLCR / debt-sizing covenant can force a full lock-up plus sweep into the SDRA.
Cash Waterfall
| Line Item | Apr 1, 2024 to Sep 30, 2025 equivalent trailing period | Apr 1, 2024 to Mar 31, 2025 |
|---|---|---|
| Opening cash balance | INR 1,780 Mn | INR 2,249 Mn |
| Operating EBITDA | INR 6,372 Mn | INR 6,241 Mn |
| Working capital and other movements | -INR 1,627 Mn | -INR 711 Mn |
| Capital expenditure | INR 0 Mn | -INR 1 Mn |
| Cash Flow Available for Debt Servicing and Reserves | INR 6,526 Mn | INR 7,778 Mn |
| Interest service | -INR 2,133 Mn | -INR 2,268 Mn |
| Debt service (repayment) | -INR 847 Mn | -INR 833 Mn |
| Total debt servicing and other reserves | -INR 2,980 Mn | -INR 3,101 Mn |
| Cash available post debt servicing and reserves | INR 3,546 Mn | INR 4,676 Mn |
| Funds distributed during period | -INR 1,195 Mn | -INR 1,801 Mn |
| Cash available for transfer to Distribution Account | INR 2,351 Mn | INR 2,875 Mn |
| Funds earmarked for capital expenditure | -INR 50 Mn | -INR 50 Mn |
| Funds earmarked for debt servicing | -INR 1,600 Mn | -INR 1,600 Mn |
| Funds earmarked for O&M expenses | -INR 30 Mn | -INR 29 Mn |
| Total funds earmarked | -INR 1,680 Mn | -INR 1,679 Mn |
| Net cash available for transfer to Distribution Account | INR 671 Mn | INR 1,196 Mn |
Source: RG II compliance certificates p. 8. September 2025 quote: "acting prudently the cash balance of INR 1,680 Mn is earmarked for debt servicing due in Oct-25, Capex Expenditure and O&M expense for 1 month."
Structure and Protections
Restricted group and note terms
- Three co-issuers under one restricted group: Adani Renewable Energy (RJ) Limited, Wardha Solar (Maharashtra) Private Limited, and Kodangal Solar Parks Private Limited
- Up to USD 362.5M senior secured notes
- 20-year door-to-door tenor with average life of 13.35 years
- Change-of-control put at 101% upon change of control and ratings decline
Source: RG II roadshow p. 2
Security and waterfall
- Substantially all co-issuer assets, contractual documents, project accounts, and escrow accounts pledged
- 100% pledge of issuer shares
- 100% amortizing debt over the PPA term with cashflow waterfall mechanism
- One semi-annual period equivalent in the senior debt service reserve account
Source: RG II roadshow p. 16
Unique covenants
- Project Life Cover Ratio of 1.6
- Minimum 65% EBITDA from sovereign-equivalent counterparties
- 100% coverage of bond principal and interest from sovereign off-taker cash flows
- Distributions linked to DSCR and FFO / Net Debt performance
Source: RG II roadshow p. 16
Analyst Notes
- RG II covenant thresholds and mechanics are documented in the Note Trust Deed dated October 15, 2019, but this repo does not yet include the full trust deed text.
- This report is derived from the March 2025 and September 2025 compliance certificates plus the September 2019 RG II roadshow. Covenant numbers are authoritative because they come from the issuers' own certifications to lenders.
- Structural detail is thinner than a full trust deed read, but materially better than compliance-cert-only because the roadshow explicitly lays out the security package, waterfall, DSCR grid, and debt-sizing covenant.
- The September 2025 RG II compliance certificate contains one internal DSCR inconsistency: the certification text and covenant table show 2.53x, while the chart note on page 9 says 2.56x. This page uses 2.53x because that is the number certified in the formal text and repeated in the summary table.
Sources
RG II Compliance Certificate — Sep 2025
Pages 7-10 provide the current covenant summary, the September 2025 waterfall, and the 2.53x DSCR / 20.2% FFO-Net-Debt / 2.00x PLCR / 72.54% sovereign-counterparty figures.
RG II Compliance Certificate — Mar 2025
Pages 8-10 provide the March 2025 comparison point: 2.61x DSCR, 19.01% FFO / Net Debt, 1.95x PLCR, 72.09% sovereign-counterparty EBITDA, and INR 1,196 Mn prudent distributable cash.
RG II Roadshow — Sep 2019
Pages 2, 16, 17, and 20 anchor the issuer set, security package, 65% sovereign floor, 1.6x PLCR covenant, DSCR lock-up grid, and 75% FFO / Net Debt restriction.