Leading brokerage firm PL Capital has reiterated its 'Buy' rating on Waaree Energies Ltd, following the company's recent analyst meet. The positive outlook is driven by Waaree's ambitious financial targets and a significant capital expenditure roadmap designed to propel its growth in the clean energy sector.
Ambitious Growth and Capital Expenditure
Waaree Energies has set a formidable revenue target of ₹1 lakh crore by financial year 2031 (FY31), which implies a compound annual growth rate (CAGR) of 30% from its projected FY26 revenue. To underpin this aggressive expansion, the company plans to deploy an organic capital expenditure (capex) of approximately ₹30,000 crore over the next two to three years.
PL Capital highlighted that this investment is critical for Waaree's transformation beyond being India's largest solar module manufacturer. The company's roadmap outlines a shift towards becoming a fully integrated clean energy platform.
Integrated Clean Energy Vision
Waaree Energies is strategically expanding its presence across various segments of the clean energy ecosystem. This includes:
- Solar modules and cells
- Ingots and wafers
- Battery Energy Storage Systems (BESS)
- Inverters and transformers
- Green hydrogen electrolyzers
- Transmission and Distribution (T&D) infrastructure
The company's strategy emphasizes deeper backward integration and the localization of critical supply chains. This approach aims to not only enhance operational efficiency but also to capitalize on a rapidly expanding addressable market, which Waaree anticipates will quadruple from US$1 trillion to US$4 trillion between 2025 and 2035.
Capacity Expansion and Financial Outlook
A key part of Waaree's growth strategy involves substantial capacity expansion. The company plans to increase its cell manufacturing capacity from 5.4 GW to 15.4 GW over the next two years. This expansion will involve phased commissioning of new facilities and a carefully managed execution strategy to support the scale-up.
Furthermore, Waaree is developing a 20 GWh integrated advanced chemistry cell and pack manufacturing facility in Rola, Gujarat. This project has a planned capex outlay of approximately ₹100 billion, with the first phase of 3.5 GWh expected by 2026 and the full 16.5 GWh capacity by 2028.
PL Capital has maintained its target price of ₹3,713 per share for Waaree Energies, indicating a potential upside from its current market price. The brokerage firm projects revenue, EBITDA, and PAT CAGRs of 21.9%, 21.7%, and 17.3% respectively over FY26-28E, valuing the company at 12x EV of March 2028E EBITDA with a PE of 18x FY28E.
“The management outlined an ambitious multi-year roadmap to transform the company from India’s largest solar module manufacturer into a fully integrated clean energy platform spanning modules, cells, ingots/wafers, BESS, inverters, transformers, green hydrogen electrolyzers, and T&D infrastructure,” PL Capital noted in its report.