Waaree Energies Ltd. shares are projected to surge by 40% within the next year, following a robust performance in its fourth-quarter earnings. Brokerage firm Nuvama has issued a 'BUY' rating, setting a price target of Rs 4,375 for the renewable energy stock, which it describes as a "multi-decadal opportunity."
Strong Financials and Strategic Expansion Drive Optimism
Nuvama's optimistic outlook for Waaree Energies is underpinned by the company's strong balance sheet and ambitious expansion plans. The brokerage anticipates significant operating cash flow (OCF) will adequately cover a substantial capital expenditure of Rs 33,000 crore over the next two years. With a net cash position of Rs 4,900 crore and an expected annual EBITDA exceeding Rs 6,000 crore, the company's financial health remains robust.
The firm has also raised its FY27/28E Profit After Tax (PAT) estimates by 4% and 7% respectively, incorporating earnings from new business ventures. Nuvama guided for a notably 25% higher FY27 EBITDA, projecting it between Rs 7,000 crore and Rs 7,700 crore.
Diversification and Capacity Growth
Waaree Energies is actively diversifying its revenue streams. The company's board has approved a Rs 3,900 crore capital expenditure for a new 2,500 TPD (tonnes per day) glass manufacturing unit and a broader fundraise of Rs 10,000 crore. This strategic shift is expected to reduce the module EBITDA share from 69% in FY26 to 19% by FY30E.
Backward integration efforts are set to boost wafer and cell EBITDA contribution to 49%, with battery energy storage systems (BESS), inverters, and transformers adding another 20% to earnings, up from negligible contributions previously. Despite a 7% quarter-on-quarter drop in Q4 cell output to 0.7 GW due to upgrade shutdowns, the company maintains a strong order book of Rs 53,000 crore, with 35% from India and 65% from overseas markets.
Furthermore, Waaree Energies plans to significantly expand its US module capacity from 1.6 GW to 4.2 GW within six months, positioning itself for growth in international markets.
Impressive Q4 FY26 Performance
For the fourth quarter of fiscal year 2026, Waaree Energies reported a 71.44% increase in consolidated net profit, reaching Rs 1,061.1 crore, compared to Rs 618.91 crore in the same period last year. Operating EBITDA saw a 70.91% rise to Rs 1,576.76 crore from Rs 922.57 crore year-over-year. The operating EBITDA margin stood at 18.59% for Q4, against 23.04% in the prior year.
The company's board has also recommended a final dividend of Rs 2 per share (20%) for FY26, pending approval at the upcoming annual general meeting (AGM).