Shakti Pumps (India) Limited

Shakti Pumps commenced FY26 on a strong note, reporting a 10% year-on-year revenue growth to ₹623 crores in Q1. EBITDA increased to ₹144 crores, achieving a margin of 23.1%, while Profit After Tax rose by 4% to ₹97 crores. This growth was primarily driven by robust performance in the solar pump segment and strong momentum in export markets, despite a 10-day operational disruption in Q1 due to a conflict with Pakistan.

As of August 1, 2025, the company's order book stood at approximately ₹1,350 crores. Management acknowledged a recent decline in the order book but attributed it to faster execution, with solar pumping systems installed within 90-120 days. They anticipate significant new order inflows in the coming period, particularly from states like Maharashtra, Haryana, and Madhya Pradesh, and expect the order book to improve by the end of Q2 FY26.

Shakti Pumps is investing ₹1,700 crores over the next two years for strategic capacity expansion. This includes doubling existing capacities for pumps, motors, solar structures, VFDs, and inverters. Key new projects include a ₹250 crore EV motors, controllers, and chargers facility under Shakti EV Mobility, and a ₹1,200 crore 2.2 GW solar DCR cell and PV module plant in Pithampur, Madhya Pradesh. A QIP of ₹292.6 crores was successfully raised to partially fund these initiatives, with the balance from internal accruals and debt.

The company maintains approximately 25% market share in the solar pump segment across key states. The solar rooftop business is gaining significant traction, driven by the PM Surya Ghar: Muft Bijli Yojana, which has already received 58 lakh applications. Shakti Energy Solutions Ltd., led by Mr. Ramakrishna Sataluri, aims to achieve market leadership in the solar rooftop space by 2030, leveraging its in-house capabilities and strong distribution network.

Exports have demonstrated a strong 25% CAGR over the past four years, contributing ₹99 crores to Q1 FY26 revenue. The company targets ₹500 crores in export revenue for the current year, with significant orders from Uganda, African countries, and other territories. This focus on exports, alongside growth in the domestic retail solar pump business (over 100 exclusive outlets), is part of a broader strategy to reduce dependency on government programs.

Despite a slight increase in raw material costs (MS up 6-7%, Steel up 1.5-2%) and competitive tender pricing, management is confident in maintaining a 24% EBITDA margin for FY26. This confidence stems from extensive in-house manufacturing of critical components like VFDs, structures, motors, and pumps, coupled with continuous R&D efforts. This integrated approach provides a significant cost advantage over competitors who rely on imported components, enabling the company to manage pricing pressures effectively.

KUSUM 2.0 is expected to launch after April 2026, encompassing both off-grid (KUSUM B, replacing diesel pumps) and on-grid (KUSUM C) solutions, promising substantial opportunities. Management reiterated its guidance for 25-30% revenue growth for FY26 and for the next 3-4 years, supported by new capacities, market leadership, and strategic diversification. The 2.2 GW solar DCR cell and PV module plant is slated to be operational by March 2027, further enhancing integration and growth.

The company is actively working to improve its working capital efficiency, targeting a reduction in receivable days from the current 152 days to 120 days by the end of FY26. This goal is deemed achievable, building on past successes in reducing receivable days from 178 to 152, and is expected to contribute positively to cash flow.