Jefferies
Target: ₹1,205
CMP: ₹903
is constructive on domestic solar market, targeting 12-15GW fully integrated capacity by FY31 with solar contributing 70-75 per cent of the business. New Cell line starts next month, while the management sees consolidation to 4–5 players going forward. Industry demand is currently estimated at about 60GW, with rooftop and PM-KUSUM contributing 45 per cent.
DCR cell pricing remains attractive. BESS, transformers and overseas manufacturing are new growth areas. We project 27 per cent EBITDA CAGR over FY26-29E. Management expects BESS ALMM-like localisation policy to be announced shortly.
All large new solar projects are increasingly being bundled with storage. Organic investment is the preferred route for transformer expansion, although management remains open to reasonably valued acquisitions.
Non-solar businesses could contribute 25-30 per cent of revenue, while management is also keen to build manufacturing capabilities in Europe and the US.
The $1.2 billion FY26-28 capex program is under execution, with about 45 per cent already spent. Peak debt could reach ₹5,000 crore, although management expects net debt/EBITDA to remain at 1.1-1.2x
The stock has corrected 20 per cent over past 2 months (vs Nifty Index: fall of 3 per cent). We recommend Buy with price target of ₹1,205.