Wind World Wind Resources Development

Points Reply

§The Statutory Auditor has issued a qualified opinion for the FY23-
§Basis of qualified opinion-
ØThe inventory of the company amounting to 850cr comprise of
Development Rights of 5480.31 MW which has been stated at cost,
Ind As 2 mandates that inventories are to be carried at cost or NRV
whichever is lower.
ØThe trade receivables amounting to 47.85 cr are from customers
and related party on sale of development rights and these are long
outstanding but no provision has been made with regards to the
same
§Emphasis of matter-
ØThe company had entered into One time settlement with Tata
capital serviced ltd on 8th Nov 2017 amounting to 12.15cr the
company however failed to execute the same, hence TCSL has filed
a claim before NCLT for resolution plan of WWIL as WWIL was the
corporate guarantor for the loan, the final approval of RP is awaited
from NCLT. The outstanding loan amounts to Rs. 9.38cr in the
books.

ØThe holding co WWIL was admitted under IBC vide NCLT order
dated Feb 20, 2018. The annual financial statements starting from
the year ended 2007 has not been approved by the board and the
annual returns are not filed with the ROC except for the year ended
2007 where unaudited FS and Annual returns is filed with ROC

ØThe company has a net outstanding payable of Rs 989 crores to

related party which are long overdue as on 31st March 2023.
§The Statutory Auditor has highlighted material uncertainty related
to going concern due to inventory carried at cost, significant portion
of trade receivables being long overdue and huge borrowing and
statutory liability obligations and borrower inability to pay the
vendors on time.
Key Financial findings-
ØTrade payables amounting to Rs 682.60 crores overdue for more
than 3 years
ØCash losses of Rs 3.7crs
ØArrears Statutory Dues amounting to Rs 1.46crs
§Related Party Transactions
ØAdvances Receivables from WWIL amounting to Rs 57 crs
ØLoans taken from WFKL during the year amounting to Rs 1.64 crs

ØICD amounting to Rs 28.15 from Wind World(India) infrastructure

pvt ltd
ØAdvances receivables amounting to Rs 7.71 crs from Wind
World(India) infrastructure pvt ltd
§As mentioned in CAM, WRDPL currently has a Development
Rights (DR’s) inventory of 5,488.31 MW aggregating to Rs. 850.7 Cr
(valued at cost). Till FY20, these DR’s were being sold to the
customers who have agreed to purchase WTG’s from Wind World
India Ltd. (WWIL), for setting up their wind farm projects.
However, since WWIL is currently under Corporate Insolvency
Resolution Process (CIRP), the marketability of the DR’s will
depend on the outcome of the CIRP, Apart from this, the changes in
Governmental policy on wind sector has also adversely affected the
marketability of DR’s.

§As mentioned in CAM the debt of WRDPL was being serviced by

surplus cash generated from Wind farms Karnataka(WFKL) project.
However, due to non-renewal of forest land lease its cashflows are
not sufficient to service even its own debt obligation due to which
both the loans are overdue.
§The company has 12MW project for which all cashflows are routed
through YBL escrow account, on analysis we have observed that its
credits for the period 01/04/23 to 31/12/23 amounts to Rs 7.59crs
from fellow subsidiary* (2.94crs), director (0.99crs) and Gujarat urja
vikas nigam (3.66crs)
*fellow subsidiary include WFKL
velopment Private limited(WRDPL)- Rs. 55.66crs
Rs. 55.66crs
Wind World Farms Karnataka(WFKL)- Rs 7.92 cror
Points Reply
§The Statutory Auditor has provided a qualified opinion for
FY23 and emphasized on the following points –
ØThe purchase contract entered by WFKL with WWIL for
construction of 2 WECs of 800Kw/H at Karnataka which was to
be completed by 30th April 2021 and for which WFKL had
disbursed Rs 7.27 crores as at 31st march 2021, but the project is
yet to commence as at date.
ØThe holding co WWIL was admitted under IBC vide NCLT
order dated Feb 20, 2018. The annual financial statements
starting from the year ended 2007 has not been approved by the
board and the annual returns are not filed with the ROC except
for the year ended 2007 where unaudited FS and Annual returns
is filed with ROC
§Key Financial Findings-
ØDecrease in revenue Rs 2.2cr (FY22 24.98cr)
ØLoss before tax Rs 4.9cr (FY22 PBT 24.98cr)
ØArrears of statutory dues amounting to Rs 1.07 crs
ØTrade Receivables Rs 13.30cr ageing above 1 year(out of
which Rs 6.7cr are withheld by BESCOM on directives of deputy
conservator of the forest department for any shortfalls towards
renewal charges of forest land lease)
ØTrade payables Rs 14.83cr ageing above 1 year
§Related Party Transactions
ØThe Borrower has granted loans to related party amounting to
Rs 24.45cr as on 31st march 2023 without specifying any terms or
period of repayment, out of the which Rs 1.64cr has been
disbursed to Wind world Wind Resources development during
the year
ØUnsecured loan taken from Wind world farms (Temdarai) pvt
ltd during the year amounting to Rs 1.65 crs
ØCapital advances receivable from WWIL amounting to Rs 7.27
crs
§The project of the borrower consists of 35x600 kW (21 MW) in
Chitradurga district(where operations has been stopped since
June’22 due to non-renewal of forest lease) and 4x800 kW (3.2
MW) in Gadag district of Karnataka, considering the shutting
down of the project posing a threat on company’s revenue.
§On the analysis of the term loan statement, we have observed
that there has been instances of interest overdue for 89days and
getting repaid on the 90th day, further the borrower is in SMA 2
category due to non-servicing of interest on time.
§The borrower’s cashflow are routed through YBL escrow
account, on analysis we have observed that its credits for the
period 01/04/23 to 31/12/23 amounts to Rs. 6.4 crores from
director(0.02cr), fellow subsidiary (4.05cr) and Bangalore
electricity suppy co ltd(1.36cr).
Rs 7.92 crores