Detailed Narrative
Robust Q3 & 9M FY26 Financial Performance
Vikram Solar reported strong financial results for Q3 FY26, with revenue increasing to INR 1,106 crores, up 7.8% YoY from INR 1,026 crores. EBITDA saw a significant surge of 141% YoY to INR 205 crores, with the EBITDA margin expanding to 18.5% from 8%. For the nine-month period, sales volume reached 2.3 GW, marking a 109% YoY increase, and revenue grew 50.1% YoY to INR 3,349 crores. The 9M EBITDA stood at INR 682 crores, achieving a 20% margin, up from 12% in 9M FY25, demonstrating improved operating leverage.
Major Capacity Expansion and Technology Shift to TOPCon
The company successfully commissioned its 5 GW advanced module manufacturing facility at Vallam, Tamil Nadu, increasing its total installed module capacity to 9.5 GW. This new facility is built on N-type TOPCon technology, aligning with Vikram Solar's strategy to fully transition its capacity to high-efficiency TOPCon modules. All future additions, including the planned 6 GW module and 12 GW cell capacities at the Gangaikondan site, will also be TOPCon, ensuring a future-ready product portfolio.
Strategic Capital Allocation for Integrated Growth
Vikram Solar detailed significant capex plans, including INR 6,400 crores for the Gangaikondan module and cell facilities, to be funded by INR 3,800 crores debt and the balance from equity (IPO proceeds and internal accruals). An additional INR 4,300 crores is allocated for a BESS plan, with INR 2,800 crores from debt and INR 1,300 crores from internal accruals over 30 months. The company also opted to lease its 5 GW Vallam facility for ~INR 400 crores via debt financing, prioritizing speed of commissioning, an asset-light approach, and tax benefits.
Growing and Diversified Order Book
As of 9M FY26, the company's order book stood at 10.58 GW, reflecting a 28% YoY growth compared to 8.2 GW in the same period last year. The order book is well-diversified across client types, with IPPs contributing approximately 55%, C&I 21%, Government/EPC 11%, and distribution 13%. Management indicated that 88% of the order book includes pass-through clauses for cell price changes, providing a hedge against input cost volatility.
Favorable Industry Outlook and Policy Support
India's solar market is projected to become the world's second-largest by 2026, with over 50 GW of new capacity additions. Policy measures like the Renewable Consumption Obligation (RCO) framework and progressively increasing minimum efficiency thresholds (20% to 21.5% by FY28) are driving demand for advanced technologies and domestic manufacturing. The company anticipates a DCR utility-scale demand of 30-35 GW by FY28, reinforcing long-term growth prospects.
Managing Input Costs and Export Market Dynamics
The company acknowledged short-term input cost pressures from shifts in the Chinese supply chain, the removal of a 9% VAT export rebate from April 2026, and surging silver prices impacting N-type cells. However, these are largely mitigated by pass-through clauses in contracts. For export markets, which constitute 16% of the order book, the company is actively developing UFLPA and FEOC compliant supply chains from Southeast Asian countries to navigate reciprocal tariffs and access key markets like the US.