Waaree Renewable Technologies Ltd’s shares are up about 10% this week after it said it had received an order for a two-gigawatt (GW) solar project from Jindal Renewables. The order, higher than its cumulative backlog of 1.7GW at September-end, is the largest received by the solar EPC (engineering, procurement and construction) company so far and establishes its position as a gigawatt-scale project execution player.
With a pipeline of about 18GW, an order win rate of 25% and its parent, Waaree Energies Ltd, being the source for key raw material supplies, Waaree Renewable looks set to maintain its growth ahead.
Waaree Renewable is seeing significant traction in its business with increasing adoption of renewable energy across both government agencies and private sector consumers. Nearly 80% of its orders come from the private sector, and have a faster turnaround time.
The market is also exploring the use of solar power for battery energy storage systems, pump hydro storage systems, green hydrogen, etc., although their large-scale commercialization is still to be established.
On solid ground
Supplies from the parent reduces the possibility of future disruption with recent government notification directing all module manufacturers to procure their solar cells from an approved list of vendors only from June 2026.
The company’s presence in the operations and maintenance (O&M) segment, with most of its clients giving three to five years of O&M contracts, helps build another revenue stream. The segment accounts for nearly one-third of its order backlog. It is also bidding for external O&M contracts and expects the segment to grow by 2-3x next year onwards.
With the thrust on rooftop solar and a large number of projects being awarded in the one-megawatt (MW) category, the company has hived off the smaller module business for better focus and to maintain its share in the segment.
Waaree Renewable has had a stellar run in recent years, recording a compound annual growth rate (CAGR) of 133% in revenue during FY22-24. During the half-year that ended on 30 September (H1FY25), revenue grew by over 170% year-on-year to ₹760 crore, while Ebitda grew by 155% to ₹113 crore. The company expects its margin to stabilize around 15%, down from about 20% over the past few years, with a greater number of projects coming up in 1,000+MW category, which have tighter margins. Ebitda is short for earnings before interest, taxes, depreciation, and amortization.
The company’s management has guided for the execution of about 1.2GW capacity in H2 against 0.7GW in H1.
While the company’s stock has risen by about 220% over the last year, it is down more than 50% from its 52-week peak of ₹3,038 apiece on 26 April. The stock currently trades at about 75x its trailing twelve-month earnings. Investors will monitor whether earnings growth can be sustained over the next few quarters.
