Detailed Narrative
Strong Financial Performance in FY26
Sahaj Solar delivered a robust financial performance for FY26, with revenue increasing by 27% year-on-year to INR419 crores, up from INR329 crores in the previous year. The second half of FY26 (H2) alone contributed INR308 crores, marking a 33% year-on-year growth. Profit after tax (PAT) for FY26 also saw an increase to INR29.6 crores from INR27.5 crores in the prior year, representing a 7.6% growth. Despite this, PAT margins marginally declined from 8% to 7% due to higher interest costs, while EBITDA margins remained stable at 13-14%.
Robust Order Book and Execution Visibility
As of March 31, 2026, the company holds a strong order book of INR402 crores, which management is confident will be entirely executed during the financial year FY27. This order book is well-diversified, comprising INR107 crores from solar water pumping systems, INR44 crores from off-grid solar systems with BAS, and INR251 crores from grid-connected solar systems. Additionally, the company has bid for over INR1,000 crores in new orders, indicating a healthy pipeline for future growth, although these are yet to be confirmed.
Working Capital Management and Debt Profile
The company successfully repaid an INR100 crores working capital loan from IREDA in April 2026, two months ahead of schedule, demonstrating improved liquidity management. However, the debt-equity ratio increased to 1.27 due to a new INR125 crores loan taken from IREDA in the last quarter of FY26. Management acknowledged increased debtor days due to delayed payments from government projects but expects operating cash flow to turn positive by the end of Q3 FY27, with efforts to reduce average borrowing costs from 11-12% to 9-10%.
Strategic Diversification and International Expansion
Sahaj Solar is actively diversifying its product and project portfolio, expanding into AC and LT distribution panels and Compact Substations. A significant new partnership with NDDB for over 10,000 solarized bulk milk chillers over the next three years is expected to drive future growth, with orders anticipated to commence from H2 FY27. Internationally, the company is executing projects in Uganda and has a signed pipeline of INR55 crores in Zambia, with a 10 MW EPC project in Zambia targeted for completion in FY27.
Capacity and Technology Focus
The company maintains an annual module manufacturing capacity of 100 MW, currently utilized at approximately 60% for internal production. Sahaj Solar has opted to put further module capacity expansion in India on hold, shifting a planned 750 MW plant to Dubai, citing geopolitical and market conditions. The focus remains on enhancing product quality and lifespan through new technologies like anti-soil and nano coatings, which are expected to reduce panel degradation.
Mitigating Risks from Supply Chain and Government Dependence
Management acknowledged challenges from geopolitical situations, supply chain disruptions, and raw material price volatility, which led to some gross margin correction. However, they successfully managed supply through timely advances and agreements. To mitigate risks associated with government schemes like PM KUSUM, the company is diversifying its project base towards solar and battery-based solutions (BESS) and off-grid projects for clients such as the Border Security Forces, ensuring resilience against potential scheme delays or non-renewal.