Saatvik Green Energy Q1 FY27 earnings call

Saatvik Green Energy Limited reported a moderate Q1 FY27, with production at 408 MW and sales at 334 MW. Revenue from operations significantly declined by 44.2% YoY to INR 5,110 million, and EBITDA fell by 76.1% YoY to INR 425 million, resulting in an 8.33% EBITDA margin. Profit after-tax also saw a sharp decline to INR 54 million. This performance was primarily attributed to lower sales volumes and challenging market conditions, including geopolitical factors and regulatory uncertainties.

The Phase 1 project in Odisha, encompassing 2.4 GW cell and 4 GW module manufacturing capacity, is progressing well and remains on track. Tool move-in activities for cell manufacturing have commenced, with ALMM-2 inspection planned for September 2026. The company anticipates cell production to begin by Q3 FY27 and aims for 80% utilization by Q4 FY27, which is expected to significantly boost EBITDA in the second half of FY27.

Beyond Phase 1, Saatvik is advancing with Phase 2, which will add 3.6 GW of cell manufacturing capacity, targeting completion by FY28 with site activities commencing by Q2 FY27. Planning for Phase 3, encompassing 6 GW of ingot and wafer manufacturing capacity, is also underway for completion by FY29. These expansions are strategically aimed at deepening backward integration, strengthening supply chain resilience, and building a comprehensive domestic solar manufacturing ecosystem.

The company holds a strong confirmed order book of 6.35 GW, translating to approximately INR 8,200 crores, representing 132% of its current operational module capacity. New orders totaling INR 538 crores were secured in July and August 2026. The order book is expected to be executed within 12-18 months, with 70% from utility and 30% from C&I segments. DCR cell orders, primarily from in-house manufacturing, are expected to yield 18-20% margins, indicating higher profitability for integrated operations.

Saatvik is actively diversifying its customer base by entering the B2C segment and expanding its distribution network and export opportunities. The company is also broadening its product portfolio with offerings such as the Saatvik SuryaConnect Solar Kit and UDAY Plus Hybrid Inverter. Management aims to increase the revenue contribution from non-solar module businesses from the current 4-5% to 7-10% in FY27, and further to 15% by FY28, evolving into an integrated energy platform.

The company has incurred approximately INR 1,000 crores in capex to date for its Odisha plant. The total capex for Phase 1 is estimated at INR 1,850 crores, and Phase 2 at INR 1,600-1,700 crores, bringing the total expansion cost to roughly INR 3,500 crores. Current debt stands at approximately INR 1,250 crores, with a debt-to-equity ratio of 0.99. Net debt is projected to peak at INR 2,200-2,400 crores, reflecting the significant investments in capacity expansion.

Following the Melcon acquisition in Q1 FY27, Saatvik has entered the transformer and power electronics business. The current market size for transformers is INR 30,000 crores, projected to grow to INR 55,000 crores by 2031. The company aims to achieve an 8-10% market share and build a INR 1,000-1,500 crores business in this segment over the next 3-4 years, leveraging the growing demand across various energy sectors.