Shares of ReNew Energy Global (NASDAQ: RNW) surged 5.1% in Thursday's pre-market session, following the renewable energy company's impressive second-quarter fiscal 2025 earnings report and growth updates.

ReNew Energy Global reported revenue of ₹29.9 billion for Q2 2025, a 15% year-over-year increase, driven by expansion of its operating capacity. Net income soared 31% to ₹4.94 billion, with profit margins improving to 17% from 14% a year ago. The company's earnings per share (EPS) of ₹13.62 surpassed analyst expectations.

In the earnings call, ReNew Energy Global highlighted several positive developments:

• Adjusted EBITDA rose 14% due to cost optimization efforts, including renegotiating OEM contracts and reducing discretionary spending.
• Operating capacity grew by approximately 30% year-over-year, net of asset sales, with the total contracted portfolio expanding to 16.3 gigawatts, including 900 megawatt-hours of battery storage.
• The company's 6.4-gigawatt solar module manufacturing facilities are fully operational, with trial production of solar cells also initiated.
• Cash flow from operating activities increased 10% year-over-year to ₹20.1 billion, while cash profit grew 31% to ₹12.1 billion.

However, ReNew Energy Global also acknowledged some potential risks and challenges:

• Wind farm performance was affected, with plant load factors down by 300 basis points.
• The company has legacy power purchase agreements (PPAs) with lower tariffs compared to current market conditions.
• There is a risk of delay in the RTC project due to transmission readiness, although the company does not currently expect this.