Solarworld Energy Solutions Limited — Q1 FY26 earnings call

Call held 17 Oct 2025

Management summary

Solarworld Energy Solutions reported a stable Q1 FY26 with a total income of ₹80.55 crores and a PAT of ₹12.91 crores, driven by operational resilience and strong execution. The company's backward integration strategy is progressing well, with its 1.2 GW module line now operational, and BESS and cell lines on track for future commissioning. A robust order book of ₹2,500 crores provides strong revenue visibility, despite some project delays.

Highlights

  • Q1 FY26 Total Income of ₹80.55 crores, reflecting strong operational resilience.

  • Q1 FY26 PAT of ₹12.91 crores, translating to a healthy net margin of 18.9%.

  • EBITDA margin for Q1 FY26 at 12.9%, supported by capacity utilization and supply chain optimization.

  • Robust order book of approximately ₹2,500 crores, with 60% expected to be executed in the current financial year, providing strong revenue visibility.

  • Key manufacturing facilities, including the 1.2 GW TOPCon solar module line, are fully operational, enhancing backward integration and cost efficiency.

Concerns

  • SJVN order worth ₹459 crores was suspended due to client-side land acquisition delays, though ₹250 crores has already been recognized.

  • Revenue generation exhibits seasonality, with Q1 and Q2 typically weaker, and Q3/Q4 being stronger due to project execution cycles.

Key financials

  1. Total Income ₹80.55 Cr
  2. Other Income ₹12.31 Cr
  3. EBITDA Margin 12.9%
  4. PAT ₹12.91 Cr
  5. Net Margin 18.9%

What they filed

Q1 FY27: revenue up 111.8%, net profit down 5.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue142 204 178 68 127 −11%495 +143%512 +188%144 +112%
EBITDA30 59 14 10 17 −43%60 +2%54 +286%12 +20%
Net profit23 44 12 17 15 −35%51 +16%50 +317%16 −6%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Order book

high confidence

Total value

₹2,500 Cr

as of 2025-06-30 quantified

Execution

typically tends to be between 12 months to 18 months for our project

Composition

Mix 2 client types
  • NTPC Green ₹900 Cr 66.2%
  • SJVN Green Energy Limited ₹459 Cr 33.8%

Share of order book by client type, derived from disclosed amounts

Pipeline

qualified rfp

Orders coming out for bid in the market are very strong.

Cancellations & deferrals

  • deferred: SJVN Green Energy Limited order worth Rs. 459 crores suspended due to client-side land acquisition delays. Rs. 250 crores already recognized.
The order book is robust and expected to be built up over the next couple of months, with a significant portion targeted for execution in the current financial year.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex Capex disclosed Cell line: ₹420 crores from IPO equity, ₹155 crores from debt. BESS and Junction Box lines: funded internally through equity.
    • Cell manufacturing facility (total project cost) ₹575 Cr
    For the solar cell line, we have earmarked Rs. 420 crores out of my IPO to fund the equity portion of it. In addition to that, the total project is estimated to be around Rs. 575 crores. So, for that subsidiary, we will take a debt of close to about Rs. 155 crores. ... The BESS line we have funded internally through equity. ... The junction box line again will be funded through equity and no debt is envisaged for that.
  • Debt Debt disclosed
    • New borrowing Temporary working capital loan from related party (Pioneer). ₹50 Cr
    • New borrowing Debt for cell manufacturing facility. ₹155 Cr
    If you look at our books today, I think we are net debt free.
  • Liquidity Liquidity disclosed Internal accruals and capital base are sufficient to fund growth. Banking limits support working capital requirements.
    I think my internal accruals and the capital base that we have built already is more than sufficient to fund that growth. ... We have our banking limits which support us in doing this.

Guidance & targets

Order Book

  • Order book execution for current FY Order Book · current financial year · High confidence 60%
    We expect to execute about 60% of this capacity in the current financial year.

    — Kartik Teltia

Revenue

  • Revenue for current FY Revenue · current financial year · Medium confidence ₹1,500 crores
    So, that would mean our revenue this year could be roughly Rs. 1,500 crores? Is that, like, a right estimate, sir?

    — Darshil Jhaveri

  • Revenue Growth Revenue · next couple of years · Medium confidence Very strong
    So, you should see a couple of very strong years from us.

    — Kartik Teltia

Profitability

  • PAT Margins Profitability · current financial year · Medium confidence 15-16%
    So, last year, my PAT margins were close to, I think about 15% to 16%. Last year was a typically very, very good year for us. But in general, the industry sees a PAT margin of about 10% to 11% on EPC projects. With backward integration, we do expect our margins to go up because the margins we are leaving on the table for solar panel manufacturers will now accrue to Solarworld going forward.

    — Kartik Teltia

Capacity

  • Manufacturing Capacity Utilization Capacity · High confidence 70-80%
    So, we intend to utilize maybe 70%-80% of this capacity internally.

    — Kartik Teltia

  • BESS Line Operationalization Capacity · January 2026 · High confidence Operational
    Our lithium-ion cell to battery pack line, which is our BESS line, that should be operational in January 2026.

    — Kartik Teltia

  • Junction Box Line Operationalization Capacity · before March 2026 · High confidence Operational
    We expect that also to come, become operational before March 2026.

    — Kartik Teltia

  • Cell Line Operationalization Capacity · December 2026 - March 2027 · High confidence Operational
    The project is expected to be operational between December 2026 and March 2027.

    — Kartik Teltia

What to watch in Q2 FY26

SJVN Project Execution Progress

Next quarter (for land acquisition progress) and by March 2026 (for project completion).
Current Land acquisition delayed, ₹250 crores recognized from ₹459 crore order.
Target Land acquired, significant progress towards March 2026 completion.

Why it matters

Ensures realization of a significant order and mitigates risk of further delays, impacting revenue visibility.

We are hoping to get that land in November and execute these projects by March 2026.

Risks & concerns

  • SJVN Order Delay due to Land Acquisition

    medium

    Execution of a ₹459 crore SJVN order is delayed due to client-side land acquisition issues, though ₹250 crores has already been recognized, with full execution expected by March 2026.

    Both acknowledged

  • Working Capital Strain with Rapid Growth

    low

    Potential for working capital requirements to increase significantly with projected revenue growth, though management expresses confidence in managing it through banking limits and efficient cash flow.

    Analyst acknowledged

  • Module Market Oversupply

    low

    Potential for oversupply and price pressure in the module manufacturing market in 3-4 years, but management's strategy is to use manufacturing primarily for internal EPC consumption, not as a standalone business.

    Management acknowledged

Q&A highlights

6 direct
Order book execution and margin impact from backward integration Direct
So, last year, my PAT margins were close to, I think about 15% to 16%. Last year was a typically very, very good year for us. But in general, the industry sees a PAT margin of about 10% to 11% on EPC projects. With backward integration, we do expect our margins to go up because the margins we are leaving on the table for solar panel manufacturers will now accrue to Solarworld going forward.

Clarifies revenue visibility, execution timelines, and the expected margin uplift from backward integration, which is a core strategic pillar.

Asked by Darshil Jhaveri

Long-term vision and CAPEX timelines for manufacturing facilities Direct
So, in terms of vision, firstly, to answer, we intend to be amongst the top 2 or 3 EPC companies in India. That is our vision. We are not transforming into a manufacturing company. Our vision is to remain EPC, which is supported by very highly efficient manufacturing facilities to the extent that our EPC business requires.

Outlines the strategic direction (EPC-first with integrated manufacturing support) and provides timelines for major CAPEX projects (BESS Jan 2026, Junction Box before Mar 2026, Cell line Dec 2026-Mar 2027).

Asked by Darshil Jhaveri

BESS business prospects, economics, and competitive landscape Direct
So, see BESS, I would tell you that if you look at the current scenario in the country, BESS has become a very, very, very fast growing segment in the solar industry. So, solar with BESS, I think a couple of days we had a bid at which prices quoted were as low as Rs. 2.86 per unit for solar with BESS of around 2 to 4 hours, which I think has hit that inflection point where solar with BESS is now the cheapest source of power to get electricity around the clock.

Highlights the significant market opportunity in BESS, the company's competitive advantage as an EPC with integrated BESS manufacturing, and the favorable economics of solar+BESS.

Asked by Darshil Jhaveri

Suspension of SJVN order and its implications Direct
SJVN Green Energy Limited had given us two orders in Gujarat. One was for 100 megawatt and one was for 260 megawatt, out of which we have already completed about 50% to 60% of that order. SJVN Green, as part of this order, was required to give us land to execute. The land was delayed from their end and they have extended the suspension. We are hoping to get that land in November and execute these projects by March 2026.

Addresses a potential red flag regarding order book quality and clarifies that it's a delay due to client-side land issues, not a company execution problem, with a significant portion already recognized.

Asked by Bhavik Shah

Working capital management for projected revenue growth Direct
Sir, so we keep a very close eye on our working capital requirement. We have our banking limits which support us in doing this. But sir, your working capital is also very, very easily managed if you manage the flow of your material and payment from your customer. So, we pay a very close attention to that. So, as our revenue is growing, working capital tends to become a challenge. But we don't foresee any problems for achieving our target for the current year in terms of working capital.

Reassures investors about the company's ability to manage working capital despite rapid growth, citing banking limits, efficient material flow, and customer payment terms.

Asked by Heer H

Strategic dilemma between investing in EPC growth versus backward integration manufacturing Direct
So, I'll try to answer this slightly differently. So, if you look at my EPC business, my EPC business is restrained by two factors. One is the working capital that we have to take up the next few projects. And second is my capacity to execute. So, last couple of years, we've seen very, very good numbers where we have very healthy cash flows. And we strongly believe that our EPC business is not self-sustainable. We really need external support to go to the next level.

Explains the rationale behind backward integration as a way to support and strengthen the core EPC business by improving cost efficiencies and offering integrated solutions, rather than a pivot away from EPC.

Asked by Miyush Gandhi

2 min read 6 chapters

Detailed narrative

Q1 FY26 Financial Performance Overview

Solarworld Energy Solutions reported a total income of ₹80.55 crores for Q1 FY26, which included ₹12.31 crores in other income. The company achieved a Profit After Tax (PAT) of ₹12.91 crores, translating to a healthy net margin of 18.9%. The EBITDA margin for the quarter stood at 12.9%, a result of improved capacity utilization, supply chain optimization, and favorable input cost management.

Robust Order Book and Execution Outlook

The company currently holds a strong order book of approximately ₹2,500 crores, predominantly comprising EPC and BESS projects. Management anticipates executing about 60% of this order book in the current financial year, which could translate to a revenue of roughly ₹1,500 crores for FY26. Project execution periods typically range from 12 to 18 months, with the company historically experiencing stronger revenue recognition in the latter half of the financial year (Q3 and Q4).

Strategic Backward Integration and Capacity Expansion

Solarworld's backward integration strategy is advancing with key facilities becoming operational. The 1.2 GW TOPCon solar module manufacturing line at Roorkee commenced operations in August 2025. Further expansions include a 3.4 GW lithium-ion cell-to-battery pack line at Roorkee, scheduled to be operational by January 2026, and a 1.2 GW solar manufacturing line for G12R cells at Pandhurna, targeted for December 2026 to March 2027. A junction box manufacturing line is also expected to be operational before March 2026.

BESS Business: A High-Growth Strategic Focus

The Battery Energy Storage System (BESS) market is identified as a rapidly growing segment, with recent bids indicating solar+BESS as the most cost-effective source for round-the-clock electricity at ₹2.86 per unit. Solarworld aims to capitalize on this by leveraging its integrated EPC and BESS manufacturing capabilities, offering complete turnkey solutions. The 3.4 GW annual capacity BESS line is funded internally through equity, reinforcing the company's commitment to this high-potential area.

Capital Allocation and Working Capital Management

The company maintains a net debt-free position and plans to fund its cell manufacturing facility (total CAPEX of ₹575 crores) with ₹420 crores from IPO equity and ₹155 crores from debt. Other manufacturing lines are funded through equity. Management expressed confidence in managing working capital for projected growth, relying on internal accruals, banking limits, and efficient material and payment flows, despite a temporary ₹50 crore working capital loan from a related party.

Industry Outlook and Competitive Positioning

India's solar capacity reached 82 GW by March 2025, with an ambitious target of 280 GW by 2030, signaling substantial growth opportunities in a market expanding at 20-30% annually. Solarworld aims to be a top 2-3 EPC company in India, utilizing its integrated manufacturing capabilities to support its core EPC business by improving cost efficiencies and offering comprehensive solutions, rather than pivoting to become a pure manufacturing entity.

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