Sterling and Wilson Renewable Energy Limited — Q4 FY26 earnings call

Call held 24 Apr 2026

Management summary

Sterling & Wilson Renewable Energy Limited reported a strong FY26 with record order inflows and order book, leading to its highest annual turnover and quarterly PAT since listing. However, the full-year PAT was impacted by significant exceptional litigation costs. The company is actively pursuing new opportunities in BESS and wind, while navigating challenges from commodity price volatility and ongoing US litigation.

Highlights

  • Order inflow for FY26 exceeded INR10,000 crores, marking it one of the most successful years.

  • Unexecuted order value (order book) reached a record high of INR11,813 crores, providing strong future visibility.

  • FY26 annual turnover was INR7,548 crores, a 20% increase over FY25, the highest since listing.

  • Q4 FY26 PAT was a record INR142 crores, the highest since listing.

  • O&M portfolio grew to 13.5 gigawatts from 8.7 gigawatts, positioning the company as a large third-party O&M player.

  • Bank rating upgraded by two notches from BBB- to BBB+.

Concerns

  • Q4 FY26 revenue dropped sequentially and year-on-year to INR1,946 crores due to commodity price volatility and deferred execution plans.

  • FY26 reported PAT was a loss of INR296 crores, negatively impacted by INR611 crores in exceptional items related to non-indemnified litigation matters.

  • Slowdown in Q4 order pickup due to commodity price uncertainties and connectivity issues in Rajasthan/Gujarat.

  • Nigeria project is on a slow pace and may not happen in FY26.

  • US litigation cases are ongoing and could potentially incur additional costs beyond the INR200 crores already covered by promoter indemnity.

Key financials

3 periods

Headline

  • Annual Turnover
    ₹7,548 Cr
    YoY +20%

Q4 FY26

  • Revenue
    ₹1,946 Cr
  • PAT
    ₹142 Cr

FY26

  • PAT
    ₹-296 Cr
  • Gross Margin
    10.5%
  • Operational EBITDA
    ₹444 Cr
    YoY +53%
  • Operational EBITDA Margin
    5.9%
  • Exceptional Items
    ₹611 Cr

What they filed

Q1 FY27: revenue down 9.8%, net profit up 35.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue1,030 1,837 2,519 1,762 1,749 +70%2,092 +14%1,946 −23%1,590 −10%
EBITDA18 70 134 85 4 −78%67 −4%146 +9%79 −7%
Net profit9 17 55 39 -478 −5411%2 −88%142 +158%53 +36%
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

₹11,813 Cr

as of 2026-03-31 quantified

29.9% YoY

Composition

Mix 2 geographies
  • Domestic 78.3%
  • International 21.7%

Share of order book by geography

Pipeline

qualified rfp

Overall bid pipeline of 31 GW, with over 27 GW in India

The company achieved record order inflows and order book in FY26, with strong growth in domestic and international EPC, providing excellent revenue visibility for the future. Q4 order pickup was muted due to commodity price volatility and project deferrals.

Source: Prepared remarks

Capital allocation

high confidence
  • Debt Debt disclosed
    • Repayment Debt levels declined by INR149 crores compared to last quarter. ₹149 Cr
    • New borrowing Raised fresh credit lines to the tune of nearly INR2,800 crores. ₹2,800 Cr
    Our debt levels have declined by INR149 crores compared to last quarter, reflecting stronger cash flow generation and scheduled repayments done during the quarter.
  • Liquidity Liquidity disclosed Net working capital improved to negative INR329 crores from negative INR407 crores in the previous quarter.
    Our net working capital was at negative INR329 crores compared to negative INR407 crores in previous quarter due to a pickup in vendor payments in Q4.

Guidance & targets

Order Inflow

  • Order Inflow Growth Order Inflow · FY27 · Medium confidence 15%
    So we'll definitely be growing at a reasonably, let's say, 15% I mean, growth, yes.

    — C.K. Thakur

  • BESS Order Share Order Inflow · New orders books · Medium confidence 20%
    in our new orders books, I'm expecting 20% order to come from the battery, rest will be from the solar.

    — C.K. Thakur

Revenue

  • Revenue Growth Revenue · FY27 · Medium confidence 15%
    So the on the revenue side, I mean, we will be growing, let's say, at the 15% growth rates from the last year.

    — C.K. Thakur

Margin

  • EPC Gross Margin Margin · Medium-term · High confidence 8-10%
    We reiterate that we anticipate EPC gross margins to range between 8% to 10%, depending on whether they are turnkey or BOS orders.

    — Ajit Pratap Singh

  • O&M Gross Margin Margin · Medium-term · High confidence 20%
    On the O&M side, we expect the gross margin to stabilize at around 20% level.

    — Ajit Pratap Singh

Profitability

  • Operational EBITDA Margin Profitability · Medium-term · Medium confidence 4-5%
    Yes. So our overheads would be in the range of 4% to 4.5% max to max. ... even if you assume an average of, let's say, 9%, so yes, I mean, 4% to 5% would be a fair range, I mean where as a company we can work with, right?

    — Ajit Pratap Singh

Market Share

  • Solar Market Share Market Share · Current run rate · High confidence >25%
    with this run rate, our market share would be definitely more than 25%. That's what I can give you a at this stage.

    — C.K. Thakur

What to watch in Q1 FY27

Reliance New Energy Order Inflow

Next quarter / FY27
Current Deeply engaged, traction expected in FY27
Target Specific order wins or LOAs from Reliance

Why it matters

Significant potential revenue driver, currently excluded from growth guidance, could provide substantial upside.

On the second question of Reliance. So Reliance, as we have been guiding the markets also, we have been deeply engaged with them... And traction would be seen in this financial year, I'm sure.

Risks & concerns

  • US Litigation Cases

    high

    Ongoing court cases with potential for 'additional costs' beyond the INR200 crores already indemnified by promoters, with resolution expected in ~2 years.

    Management acknowledged

  • Commodity Price Volatility

    medium

    Rising PV module prices and other commodity costs impacted Q4 revenue and execution, though company has back-to-back pricing protection.

    Management acknowledged

  • Geopolitical Tensions

    medium

    Contributed to muted Q4 order activity and uncertainty in the market.

    Management acknowledged

  • Connectivity/GIB Issues in Rajasthan/Gujarat

    medium

    Delayed project development in key regions, impacting execution timelines, though GIB decisions have come and substations expected by 2028.

    Management acknowledged

  • Nigeria Project Delays

    medium

    Project is on a slow pace due to elections and may not happen in FY26, indicating potential loss of a project.

    Management acknowledged

Q&A highlights

6 direct, 1 evasive
Reliance New Energy Project Timeline & Margins Evasive
No. So all terms and conditions, everything are yet to be decided, discussed. So at this moment, I can't tell you any number.

Reliance is a major potential client, and lack of concrete timelines/margins creates uncertainty for future revenue.

Asked by Saurabh Srivastava

Q4 Revenue Degrowth & Order Pickup Slowdown Direct
market has been generally been showing less traction because of some uncertainties in the commodity prices and all. So all those orders that were slated to be concluded in quarter 4, most of them have been shifted to quarter 1. And not that our share has gone down. In general, the industry was seeing slowdown on the order book side.

Explains a key financial miss and highlights external market challenges impacting execution velocity.

Asked by Sameer Dalal

US Litigation Cases & Potential Costs Partial
since it is in litigation and it is expected to take time, it is difficult to ascertain a certain number. I think what Ajit has already alluded to is the point that as a company, we are already cash out on INR200 crores and most of it is indemnified. So there's no question of taking any hit on this INR200 crores. It is money that will come to the company from the promoters once the case is settled. ... if the case goes adversely against us, then there is always a chance that there may be additional costs...

Reveals a lingering financial risk from past international projects, with potential for further unquantified liabilities beyond indemnified amounts.

Asked by Jayesh Shroff

15% Revenue Growth Guidance Scope Direct
No. So that would be including battery, wind and solar, everything. ... Reliance is excluded out of this. We don't consider Reliance in this portfolio because Reliance orders, unless it comes in, we can't commit anything on this, right?.

Clarifies the basis of future revenue growth expectations and the potential upside from Reliance projects if they materialize.

Asked by Jayesh Shroff

Bank Rating Upgrade & Credit Lines Direct
no downgrade in the rating. We are rated as BBB+, while in the beginning of the year we were rated a BBB-. So during the year, we have been upgraded for a rating by two notch. ... we have been able to secure broadly INR2,800 crores new credit lines during the last fiscal.

Positive signal for financial health and improved ability to fund working capital and project execution.

Asked by Fazal Hawa

Reasons for Order Book Slowdown & Execution Timeline Direct
So for the last quarter slowdown, I will say that there was basically commodities price surge, from January onwards if you see the LME prices for copper, aluminium other things going up. So the developers chose to probably take a back seat for some time... in one of the regions at Rajasthan. I mean there have been 2 major areas in India - Rajasthan and Gujarat. So in Rajasthan, some of the projects, I mean, the substation projects are on- connectivity is really popping up. ... GIB issue as well.

Provides context for execution challenges and potential future acceleration as commodity prices stabilize and regulatory/connectivity issues are resolved.

Asked by Amish Kanani

BESS Market Opportunity & Order Share Direct
around 60 gigawatt hour kind of battery opportunity would be coming. ... in our new orders books, I'm expecting 20% order to come from the battery, rest will be from the solar.

Highlights a new growth avenue and the company's strategy to capitalize on the emerging battery storage market.

Asked by Nirmal

Promoter Indemnity for Exceptional Items Direct
On that INR611 crores write-off whatever we did, there was some payment out-go from our side to the party, and we have already paid the full amount by end of this quarter. And this case was non indemnified matter. So there is nothing which can be recovered from the promoter on this particular case.

Clarifies the nature of the significant exceptional loss and distinguishes it from other indemnified claims, impacting full-year profitability.

Asked by Amish Kanani

2 min read 7 chapters

Detailed narrative

Strong Order Book and Inflow Drive Future Visibility

Sterling & Wilson Renewable Energy Limited reported a robust FY26 with order inflows exceeding INR10,000 crores, a 43% year-on-year increase. This led to a record unexecuted order value (order book) of INR11,813 crores as of March 31, 2026, up from INR9,096 crores last fiscal, providing strong revenue visibility. Domestic orders comprised 78% of the current order book at INR9,250 crores, with turnkey projects accounting for nearly 70% of total orders.

Record Annual Turnover and Q4 PAT Despite Headwinds

The company achieved its highest annual turnover since listing, reaching INR7,548 crores in FY26, a 20% increase over FY25. Q4 FY26 also saw a record quarterly PAT of INR142 crores. However, Q4 revenue declined sequentially and year-on-year to INR1,946 crores, primarily due to commodity price volatility and deferred execution plans.

Impact of Exceptional Items on FY26 Profitability

Despite strong operational performance, the company reported an annual loss of INR296 crores for FY26. This was largely due to INR611 crores in exceptional items, primarily related to non-indemnified litigation matters. Management clarified that this specific amount has been paid and cannot be recovered from erstwhile promoters, though other indemnified claims are being pursued.

Growth in O&M and Strategic Focus on BESS

The Operations & Maintenance (O&M) segment showed significant growth, with the portfolio expanding to 13.5 gigawatts from 8.7 gigawatts in the last fiscal, making the company one of the largest third-party O&M players globally. The company is also strategically targeting the Battery Energy Storage Systems (BESS) market, expecting 20% of new orders to come from this segment, with a current BESS order book of INR300 crores.

Improved Financial Health and Credit Access

The company's debt levels declined by INR149 crores quarter-on-quarter, and net working capital improved to negative INR329 crores from negative INR407 crores. Sterling & Wilson also secured INR2,800 crores in fresh credit lines during FY26 and saw its bank rating upgraded by two notches from BBB- to BBB+, reflecting improved financial stability and strong banking support.

Outlook and Guidance for FY27

Management guided for a 15% revenue and order book growth rate for FY27, excluding potential Reliance projects. They anticipate EPC gross margins to be in the 8-10% range and O&M gross margins to stabilize around 20%. The bid pipeline remains robust at 31 gigawatts overall, with over 27 gigawatts in India, and the company maintains a solar market share of over 25%.

Challenges from Commodity Prices and Project Delays

The company faced challenges from rising commodity prices and geopolitical tensions, which muted Q4 order inflows. Additionally, project development in Rajasthan and Gujarat was delayed due to connectivity and GIB (Great Indian Bustard) issues, although GIB decisions have now been received, and substation commissioning is expected by 2028.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Construction earnings calls