What started with an investment of one lakh, today stands at a net worth of Rs 400 million with 0 dilutions ever: Nidhi Gupta, CEO Rays Experts.
In an interview with BW Businessworld, Nidhi Gupta, Director & CEO, Rays Experts talks about the company, business model, funding status and more.
1. Brief us about your business model like how did the idea came to start and how does it work (step by step procedure)?
When we started Rays Experts, the concept of solar parks was non- existent. Each plant had to be executed on a stand-alone basis, which would have increased the investment upfront. So, we identified the potential for a common infrastructure where everyone could set up a solar plant in their own capacity and share resources like transmission lines and maintenance at a single location. This is how we established the first private solar park in the country in 2012 at Kolayat, Bikaner. For the solar parks, Rays Experts acquires large pieces of land and develop common infrastructure like transmission lines, roads boundary, etc. It then splits this infrastructure for small size solar plants and sells them to individual plant owners who get the benefit of large infrastructure and common execution and O&M services. There are two types of investors that normally set up their plants in these solar parks:
- Those who have their own power requirements invest in the solar plant. Electricity produced in the solar plant is set off at the premises of the investor. For instance; several hotels in Jaipur have set up their power plant individually at the Bikaner solar park. With the electricity produced in Bikaner, the hotels can waive off a major amount on their electricity bill.
- Long term PPA with Govt. - Several companies sign long-term power purchase agreements with Government bodies and have to execute the project in minimum time. They prefer minimising the risk of land acquisition and transmission lines while doing their projects. For such companies, our parks are ideal ready-to-move infrastructure that eliminates the time and cost of executions.
- EPC for large size ground-based projects - Rays Experts with its experience of over 700 MW have developed key design and execution skills. It executes large size projects for marquee investors with a project size of over 100+ MW each. We offer them turnkey design and execution services.
We also have extensive experience in the residential solar segment, executing over 2500 houses projects. Going forward, we will be working on a debt service product where the upfront investment on the roof can be minimum.
2. What are the unique key points of your company?
We deliver a holistic solution when it comes to owning a solar power plant. Normally power plant setup is considered to be a wide step with land, approvals, processes, technicals, and several other aspects. However, at Rays Experts, we offer a one-stop solution to cover all of these for the investors. Through our solar parks and plug-and-play solutions, we empower everyone who is willing to set up their own power plants.
3. How are you different from the existing competitors?
Honestly, at present, we are the only company operating successfully in this space. Numerous consolidations have taken place over the past one decade and with very few players left in the ground-mounted large size projects, we have been able to consistently position ourselves among the top few players. It is an outcome of our relentless commitment towards providing access to solar power plants for all and making deep efforts in ensuring that all the hurdles in setting up a solar plant are met.
4. What is the funding status and monetization model?
We are a bootstrapped company since inception. What started with an investment of one lakh, today stands at a net worth of INR 400 million with 0 dilutions ever. We have been profitable throughout our business journey and wish to maintain this status for as much time as possible. We believe that we have created value for our employees, clients and owners and wish to keep growing with them each year.
5. What challenges are you facing in running your business?
We have experienced many ups and downs in the last 10 years, things like sudden policy changes, rough weather unseen over the last 100 years and so on. However, our foundation has been strong enough to overcome these issues and hence we believe that we are ready to take on any future challenges. Being a self-funded company, working capital was always an issue during the initial few years. But with the support and hard work of our robust team, today we are working towards our aim of reaching 1000 MW by end of this financial year.
6. How has been the people's response so far to rooftop & ground-mounted projects post lockdown?
With businesses realizing the importance of captive solar power plants and their role in saving a major part of their recurring cost, we have been witnessing over a 50% year-on-year increase in demand in the April-June quarter of 2020. Captive solar plants have turned out to be a really good business model. Considering the incentives offered by the government in states like Rajasthan and Gujarat, people are making a 20-25% internal rate of return. Currently, the commercial tariff of power is around INR 9/kWh, while the industrial tariff is around INR 7-7.5/kWh, which is very high and can be essentially saved by the companies.
7. What are the traction details (achievements of the company)?
●We are the largest private solar park in the country
●Delivering 5.5 MW rooftop solar spread across 1 million Sq. ft roof of Delhi metro stations
●Serving 250 customers on the ground, one of the largest client base in the country
●Over 4000 houses done under solar
8. How do you look at expansion?
We are looking at 1000 MW in this financial year and almost 10000 homes solarized in this financial year. Going to next year we will invest in 4 more solar parks in 3 new states.
9. What are your marketing plans?
We are trying to make awareness among industry what benefits solar can have for them. To do this consistent print media and social media ads are a tool. Word of mouth has also been our key strength as we have good references from almost all the clients we have worked with.
10. What has been the biggest learning’s so far?
There is no shortcut when it comes to setting up a good quality solar plant. We need constant monitoring of every detail minutely while working on it. Even though we do it multiple times, we can never be complacent as for each plant investor, the solar plant is an erstwhile opportunity, which cannot be messed with.
11. What is the market size and opportunity?
Rays Experts is currently looking at generating 20 GW of energy in the next 3 years making it a $12 billion industry and we endeavor to position ourselves among the top 10 players in the country contributing to it.
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