Solex Energy Limited — Q3 FY26 earnings call

Call held 12 Feb 2026

Management summary

Solex Energy reported strong revenue growth in Q3 and 9M FY26, driven by robust order inflows and the commencement of its new 2.2 GW module facility. However, profitability was impacted by higher fixed costs during the ramp-up phase and execution delays. The company maintains a healthy order book exceeding ₹4,000 crores and is actively pursuing expansion into cell manufacturing and Battery Energy Storage Systems (BESS), despite challenges with raw material price inflation and land acquisition for new projects.

Highlights

  • 9M FY26 Revenue of ₹735.1 crores, up 79.3% YoY.

  • Q3 FY26 Revenue of ₹319.4 crores, up 135.3% YoY.

  • Order inflow of ₹833 crores in Q3 FY26 (₹544 crores from Zelestra Group, ₹289 crores from IPP).

  • Total order book visibility exceeds ₹4,000 crores, providing healthy execution.

  • Successful commencement of 2.2 GW solar PV module facility at Tadkeshwar in November 2025.

Concerns

  • Q3 FY26 gross margins contracted significantly from 30-32% to 17% due to new facility ramp-up and higher fixed costs.

  • Execution delays of 2-3 months for EPC projects due to extended monsoon and client site readiness.

  • Inventory buildup of ₹150 crores finished goods and ₹200 crores raw material by December 2025.

  • Raw material (cell) price increased by 110-120%, necessitating renegotiation for some orders in the ₹4,000 crore order book.

  • Delays in finalizing land and funding (₹300-400 crores) for the 2.2 GW N-type TOPCon Plus solar cell production line.

Key financials

2 periods

Q3 FY26

  • Revenue
    ₹319.4 Cr
    YoY +135.3%
  • EBITDA
    ₹27.2 Cr
  • PAT
    ₹8.9 Cr
  • Gross Margin
    17%

9M

  • FY26 Revenue
    ₹735.1 Cr
    YoY +79.3%
  • FY26 EBITDA
    ₹88.1 Cr
    YoY +72.5%
  • FY26 PAT
    ₹39.4 Cr
    YoY +45.3%

What they filed

Q1 FY27: revenue up 4.1%, net profit down 68.2% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue132 134 253 249 149 +13%318 +137%839 +232%259 +4%
EBITDA14 24 22 38 16 +8%25 +6%92 +313%27 −29%
Net profit9 14 12 22 3 −63%8 −42%55 +364%7 −68%
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

₹4,000 Cr

as of 2025-12-31 quantified

Inflow this quarter

₹833 Cr

Execution

Execution schedule for Zelestra Group orders is February to November 2026.

Composition

  • IPP (client type) 80%

Cancellations & deferrals

  • deferred: All EPC projects are running 2 to 3 months late due to extended monsoon and client site readiness, but no orders have been cancelled or delayed.
The order book is strong and provides healthy execution visibility, but some orders may require renegotiation due to raw material price increases, and execution has faced monsoon-related delays.

Source: Prepared remarks

Capital allocation

low confidence
  • Capex Capex disclosed
    • 2.2-gigawatt solar PV module facility at Tadkeshwar
    • 2.2-gigawatt N-type TOPCon Plus solar cell production line
    • 10 gigawatts of solar cell manufacturing by 2030
    • 2-gigawatts of ingot and wafer production in the coming years
    During the quarter, we successfully commenced commercial production of our 2.2-gigawatt solar PV module facility at Tadkeshwar from November 2025. ... Additionally, the company is planning to establish 2.2-gigawatt N-type TOPCon Plus solar cell production line targeting to begin operations by year 2027. ... Additionally, Solex plans to develop upstream capability, which includes 10 gigawatts of solar cell manufacturing by 2030, 2-gigawatts of ingot and wafer production in the coming years.

Guidance & targets

Revenue

  • FY26 Revenue Revenue · FY26 · High confidence INR 1,700-1,800 crores
    With strong execution momentum backed with industry tailwinds, we are swiftly marching towards achieving INR 1,000 crores revenue and remain confident of closing financial year '26 with revenue in the range of INR 1,700 crores to INR 1,800 crores.

    — Chetan Shah

Profitability

  • FY26 PAT Margin Profitability · FY26 · High confidence 6-8%
    We target PAT of 6% to 8%.

    — Chetan Shah

Capacity

  • Total Module Capacity Capacity · by 2030 · High confidence 10 gigawatts
    As a part of its growth strategy, Solex intends to increase its total module capacity to 10 gigawatts by 2030.

    — Chetan Shah

  • N-type TOPCon Plus solar cell production line Capacity · by year 2027 · High confidence 2.2 gigawatts
    Additionally, the company is planning to establish 2.2-gigawatt N-type TOPCon Plus solar cell production line targeting to begin operations by year 2027.

    — Chetan Shah

  • Solar cell manufacturing Capacity · by 2030 · High confidence 10 gigawatts
    Additionally, Solex plans to develop upstream capability, which includes 10 gigawatts of solar cell manufacturing by 2030...

    — Chetan Shah

  • Ingot and wafer production Capacity · in the coming years · Medium confidence 2 gigawatts
    ...2-gigawatts of ingot and wafer production in the coming years.

    — Chetan Shah

Utilization

  • Q4 Module Facility Utilization Utilization · Q4 FY26 · High confidence 70%
    For next -- the last quarter, we are targeting almost 70% of utilization.

    — Vipul Shah

Funding

  • Cell line funding Funding · next week · Medium confidence INR 300-400 crores
    We are expecting some term sheets from investors. So, we are exploring 4, 5 different options. So, as per our bankers, we are expecting term sheets in the next week for an amount of around INR 300 crores to INR 400 crores.

    — Vipul Shah

BESS Opportunity

  • BESS commercial operations start BESS Opportunity · later part of FY27 · Medium confidence December 2026 or January 2027
    BESS opportunity is basically that's coming up in -- that will start. Actually, it will start in later part of the FY '27, which is maybe the December 2026 or January 2027, it will start, journey will start.

    — Chetan Shah

  • BESS market peak BESS Opportunity · October 2028 · Low confidence October 2028
    And I think it will pick up in the later part of 2028. So, I suspect I mean, I foresee the BESS at a peak in somewhere about October 2028.

    — Chetan Shah

What to watch in Q4 FY26

Q4 Module Facility Utilization

Q4 FY26
Current Full utilization from December 2025 for lines 3 & 4
Target 70% utilization

Why it matters

Achievement of this target is key for margin normalization and operating leverage benefits.

For next -- the last quarter, we are targeting almost 70% of utilization.

Risks & concerns

  • Raw material price inflation and order renegotiation

    high

    Cell prices increased by 110-120% due to silver cost. Some orders in the ₹4,000 crore order book may need renegotiation, potentially impacting future profitability or project timelines.

    Analyst acknowledged

  • Margin pressure from new facility ramp-up

    medium

    Initial phase of new 2.2 GW facility led to lower revenue recognition and higher fixed costs, impacting Q3 margins. Anticipate normalization in Q4 as utilization improves.

    Management acknowledged

  • Execution delays for EPC projects

    medium

    Extended monsoon and client site readiness caused 2-3 month delays in EPC project execution, impacting Q3 revenue booking, but no order cancellations.

    Management acknowledged

  • Delays in cell line land acquisition and funding

    medium

    Problems with GPCB and environmental clearances for initial land selection caused delays. Actively seeking new land and term sheets for ₹300-400 crores funding for the 2.2 GW cell line.

    Management acknowledged

Q&A highlights

6 direct
Impact of new capacity ramp-up on margins and full-year PAT expectations Direct
As we have informed, initially we targeted was, line 3 and 4 will be operational from the beginning of October. But as we have mentioned earlier, because of extended monsoon, the projected capacity started late. And then again, it takes time to ramp up. So practically full-fledged production for the line 3 and 4 at the optimum level has started from December. So, all fixed costs relating to the line 3 and 4 were there in the interest cost, depreciation and everything was there. So, that has impacted our profit.

Clarifies the reasons for Q3 margin compression and reiterates the full-year PAT margin target of 6-8%.

Asked by Aman

Inventory buildup and execution delays Direct
Yes. So, in fact, we have a finished good of almost INR 150 crores of finished goods is there on December '25 and raw material of almost INR 200 crores, keeping in line with the orders we have in hand. So, fortunately, the timed escalation of raw material has not impacted us because for this financial year, so we have sufficient quantity of raw material to execute the orders we have for the last quarter.

Addresses concerns about inventory accumulation, attributing it to new capacity ramp-up and client readiness, while assuring that raw material costs are secured for current orders.

Asked by Aman

Status and funding of the cell manufacturing line Partial
So like you know we had finalized one land but there was some problem in getting the you know GPCB and the environment clearances. So, we had to relook for land. And you know, Gujarat is a very industrial state. So, finding a big parcel of land and with the required power connection and water. So, we are on the verge of closing the land and shortly it will be in the public domain. ... We are expecting some term sheets from investors. So, we are exploring 4, 5 different options. So, as per our bankers, we are expecting term sheets in the next week for an amount of around INR 300 crores to INR 400 crores.

Reveals delays in land acquisition for the cell line but indicates progress on funding and technology, with a target for operations by 2027.

Asked by Aman

Gross margin contraction and material margin impact Direct
Yes, so you know material 2%-3% impact is there but for the entire quarter we have the required inventory with us. And all the rates with the suppliers and with the suppliers are fixed and the same way we have the price booked for our sales also. So that everything putting together we are confident that we will achieve the numbers what we have targeted for March 31st.

Clarifies that while there was a 2-3% material impact, the company's fixed-price contracts and secured inventory mitigate the impact for current orders.

Asked by Manan

Raw material price inflation and order renegotiation Direct
Like, if I have to mention the cell price increase the cell price increased by almost 110% to 120%. ... Some of the orders are already having a cell price as per actual. So, whenever we purchase cells for those orders, they will have to pay accordingly. Some of the orders we might have to go back and renegotiate because the prices are increased.

Highlights a significant risk of 110-120% raw material price increase, which will necessitate renegotiation for a portion of the ₹4,000 crore order book, potentially impacting future margins or execution.

Asked by Manan

BESS opportunity timeline and strategy Direct
BESS opportunity is basically that's coming up in -- that will start. Actually, it will start in later part of the FY '27, which is maybe the December 2026 or January 2027, it will start, journey will start. And I think it will pick up in the later part of 2028. So, I suspect I mean, I foresee the BESS at a peak in somewhere about October 2028.

Provides a clear timeline for the company's entry into the BESS segment and its anticipated market growth, indicating a new strategic direction.

Asked by Hiral Keniya

Q3 module capacity utilization and Q4 targets Direct
Line 3 and 4, they just got ramp up in the month of November. So full utilization was then in the month of December. For next -- the last quarter, we are targeting almost 70% of utilization.

Details the ramp-up schedule for new capacity and sets a specific utilization target for the upcoming quarter, which is crucial for margin normalization.

Asked by Amit Kumar

3 min read 6 chapters

Detailed narrative

Q3 & 9M FY26 Financial Performance Overview

Solex Energy reported robust financial growth for Q3 and 9M FY26. For the nine months, total revenue stood at ₹735.1 crores, marking a 79.3% year-on-year increase. EBITDA for the period grew by 72.5% to ₹88.1 crores, and Profit After Tax (PAT) increased by 45.3% to ₹39.4 crores. In Q3 FY26 alone, revenue reached ₹319.4 crores, a significant 135.3% year-on-year growth. However, Q3 EBITDA was ₹27.2 crores and PAT was ₹8.9 crores, with gross margins contracting to 17% from the previous 30-32% due to higher fixed costs associated with the new facility ramp-up.

Operational Update & Capacity Expansion

The company successfully commenced commercial production of its 2.2-gigawatt solar PV module facility at Tadkeshwar in November 2025, marking a major milestone. This new capacity, particularly lines 3 and 4, reached full-fledged production at optimum levels by December. Management anticipates that operating leverage from improved utilization will normalize margins in Q4, targeting approximately 70% utilization for the quarter. Solex Energy is also progressing on its Vision 2030 roadmap, including an R&D partnership with ISC Konstanz Germany for next-generation solar cell development.

Order Book & Execution Challenges

Solex Energy boasts a strong order book with visibility exceeding ₹4,000 crores, including EPC orders. During Q3 FY26, the company secured new orders worth ₹833 crores (₹544 crores from Zelestra Group and ₹289 crores from a reputed IPP). Despite the healthy order book, execution faced challenges, with EPC projects running 2-3 months late due to extended monsoon and client site readiness. However, management confirmed that no orders have been cancelled or delayed, and they are confident of achieving their FY26 revenue guidance of ₹1,700-1,800 crores.

Raw Material Inflation & Pricing Strategy

A significant concern raised was the substantial increase in raw material prices, particularly solar cells, which have surged by 110-120%. This inflation is primarily attributed to the rising cost of silver used in ribbons. While the company has secured raw materials for current FY26 orders under fixed-price contracts, a portion of the ₹4,000 crore order book for future execution may require renegotiation. Management indicated that some orders already have actual cell pricing, while others might need to be revisited with clients due to the drastic price changes.

Future Growth Initiatives: Cell Manufacturing & BESS

Solex Energy is aggressively pursuing backward integration and diversification. The company plans to establish a 2.2-gigawatt N-type TOPCon Plus solar cell production line, targeting operations by 2027, and aims for 10 gigawatts of solar cell manufacturing and 2 gigawatts of ingot and wafer production by 2030. Additionally, Solex is exploring opportunities in Battery Energy Storage Systems (BESS), viewing it as the next game-changer in renewable energy. The BESS opportunity is expected to commence in late FY27 (Dec 2026/Jan 2027) and peak around October 2028, with the company actively seeking technology partners for containerized solutions.

Industry Tailwinds & Policy Support

The solar sector is benefiting from strong structural support, as evidenced by the Union budget '26-'27. A budgetary allocation of ₹30,540 crores for solar energy schemes represents a 32% increase over FY26 revised estimates. The PM Surya Ghar Muft Bijli Yojana received ₹22,000 crores (29% increase), expected to accelerate rooftop solar adoption. Furthermore, ₹5,000 crores allocated under PM KUSUM will boost agri photovoltaic projects, strengthening long-term demand visibility for domestic manufacturers like Solex.

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