Synopsis: Waaree Energies has delivered strong growth in revenue, profits, capacity and orders, yet its shares remain nearly 30 percent below their peak. With margins under pressure, major expansion plans underway and fresh risks around cash flow and overseas markets, can the stock return to its record high once again soon?
India’s solar industry is entering a larger phase as installations rise across utility projects, commercial customers, rooftops and agricultural schemes. Policies supporting locally manufactured cells, modules and other components are also pushing companies deeper into the supply chain. The opportunity is large, but it demands heavy capital expenditure and strong execution.
Waaree Energies’ shares are trading around the Rs. 2,700 level. The stock touched an all-time high of Rs. 3,865 in September 2025 but has since declined by roughly 30 percent. It has also delivered almost no returns to shareholders in one year. The key question is whether this fall reflects temporary concerns or whether investors have already priced in much of the company’s future growth.
Why Has The Stock Struggled Despite Strong Growth?
Waaree Energies’ share-price weakness has come despite strong growth in revenue, production and profits. One major reason has been the uncertainty created by geopolitical tensions, which affected the company’s costs, supply chain and overseas business during Q4FY26.
Management said the war in the Middle East and the sharp rise in commodity prices were unexpected developments during Q4. Prices of silver and copper, two important inputs used in solar manufacturing, increased sharply. At the same time, restrictions on the movement of ships affected inbound and outbound logistics, causing freight costs to rise significantly.
These pressures were visible in Waaree’s profitability. Revenue rose 111 percent year-on-year to Rs. 8,480 crore in Q4FY26, while operating EBITDA increased 70 percent to Rs. 1,576 crore. However, the operating EBITDA margin fell from around 25.5 percent in Q3FY26 to approximately 18.6 percent in Q4FY26. A lower contribution from the higher-margin overseas business also affected the quarterly margin.
Another concern was the uncertainty surrounding Waaree’s US business. In February 2026, the US Department of Commerce announced a preliminary countervailing duty of 126 percent on certain Indian solar imports. Since overseas operations provide Waaree with better realisations and margins, such announcements can create nervousness among investors even before their actual financial impact becomes clear.
However, management said the 126 percent duty was linked to modules using India-manufactured cells and was not applicable to Waaree’s existing supply chain. The company was sourcing cells from lower-duty jurisdictions and expanding its local US manufacturing capacity to reduce exposure to import restrictions. Management therefore did not expect a material impact on the servicing of its US order book.
Therefore, the stock’s weakness was not caused by slowing demand or declining sales. It was more closely connected to worries over whether geopolitical disruption, volatile commodity prices, higher freight expenses and changing US trade policies could weaken the high margins that had supported Waaree’s earlier valuations.
How Strong Was Waaree’s FY26 Performance?
The full-year numbers were still impressive. Revenue from operations increased 83.7 percent to Rs. 26,536.77 crore. Operating EBITDA grew 117 percent to Rs. 5,908.64 crore, while the margin improved from 18.84 percent to 22.27 percent. Profit after tax rose 101 percent to Rs. 3,884 crore. The company also reported return on equity of 29 percent and return on capital employed of around 32 percent.
Quarterly growth remained strong. Revenue increased from Rs. 4,597 crore in Q1 to Rs. 6,227 crore in Q2 and Rs. 7,565.05 crore in Q3. EBITDA rose from Rs. 1,169 crore to Rs. 1,567 crore and then Rs. 1,928.15 crore, while profit increased from Rs. 773 crore to Rs. 878 crore and Rs. 1,106.79 crore. This showed that Waaree was converting capacity and orders into sales.
Module production reached 12.6 GW in FY26, up 77 percent, while sales stood at around 12 GW. Total module manufacturing capacity reached approximately 26 GW, while cell capacity stood at 5.4 GW. Its order book was around Rs. 53,000 crore, compared with Rs. 47,000 crore a year earlier, supported by a pipeline exceeding 100 GW. Retail sales, which are not included in the order book, contributed Rs. 5,515 crore and grew 84 percent.
Can The Core Solar Business Keep Growing?
The demand environment remains supportive. Motilal Oswal estimates India could require around 102 GW of integrated module manufacturing capacity. It also expects commercial and industrial projects, rooftops and PM-KUSUM to contribute more than half of annual solar installations, reducing dependence on utility tenders.
This plays to Waaree’s strengths. The company is not dependent on one customer segment. In FY26, utility, independent power producers and commercial and industrial customers contributed 34.7 percent of revenue. Overseas markets contributed 33 percent, retail contributed 20.8 percent and EPC contributed 11.6 percent.
The order book provides visibility, but its conversion remains important. Management said around 65-70 percent of the Rs. 53,000 crore order book was overseas and would be delivered over three to four years. Such orders can face changes in raw-material costs, trade rules and delivery schedules.
For FY27, management has guided for operating EBITDA of Rs. 7,000-7,700 crore, representing growth of roughly 20-30 percent over FY26. The planned 10 GW domestic cell expansion is expected to begin contributing in the second half of FY27, taking total domestic cell capacity to around 15.4 GW. Greater internal cell availability could support margins and reduce dependence on external purchases.
Will Waaree 2.0 Create The Next Growth Engine?
Waaree is attempting to become much more than a module manufacturer. It has committed approximately Rs. 30,000 crore across solar manufacturing and adjacent energy businesses. After the planned expansion, the group expects to have around 28 GW of module capacity, 15.4 GW of cells, 10 GW of ingots and wafers, 20 GWh of battery storage capacity, 4 GW of inverters, 1 GW of electrolyser capacity, 20,000 MVA of transformers and 2,500 tonnes per day of solar-glass capacity.
Backward integration into cells, wafers, polysilicon sourcing and glass can reduce supplier dependence and protect costs. Batteries, inverters, transformers, EPC and transmission can also increase the amount Waaree earns from each customer.
Motilal Oswal expects the company’s revenue to rise from Rs. 26,537 crore in FY26 to Rs. 39,599 crore in FY27 and Rs. 49,855 crore in FY28. It estimates EBITDA of Rs. 7,271 crore in FY27 and Rs. 9,474 crore in FY28. New businesses are expected to contribute around 21 percent of revenue and 17 percent of EBITDA by FY28, giving the company a broader earnings base.
What Could Prevent The Stock From Recovering?
The first risk is execution. Several projects are being built together, and delays or slower utilisation could reduce returns. The core module and cell expansion is expected during FY27, while ingot-wafer capacity and part of the battery expansion are expected during FY28. The market may therefore wait for these projects to be commissioned and begin contributing to earnings before fully pricing in their value.
The second risk is cash flow. Working-capital days increased from around 45 in FY25 to roughly 90 in FY26. Cash flow from operations stood at Rs. 1,627 crore despite much higher reported profit, partly because inventory increased when overseas shipments were disrupted. Management expects cash conversion to normalise as inventory clears, but the expansion programme will still require large funding. Motilal Oswal expects capex of around Rs. 10,000 crore in FY27 and Rs. 12,000 crore in FY28, with net debt rising over this period.
The third risk is the United States. Waaree said the preliminary 126 percent countervailing duty should not materially affect it because duties depend on where cells are sourced, and it has diversified into lower-tariff jurisdictions. It is also expanding US manufacturing and has invested in Oman for traceable non-Chinese polysilicon. Still, trade rules and investigations can create uncertainty around shipments and margins.
Can Waaree Energies Reach Rs. 3,864 Again?
Reaching the previous high is possible, but the business must now grow into the expectations that supported that price. Waaree has the scale, order visibility, brand, retail reach and expansion pipeline needed to deliver higher earnings. The planned increase in cell capacity could also improve integration and support margins from the second half of FY27.
However, a return to Rs. 3,865 will likely require three things: delivery of the FY27 EBITDA guidance, recovery in margins after the Q4 decline and better conversion of profits into operating cash flow. Investors will also need confidence that the Rs. 30,000 crore expansion is creating profitable capacity rather than only increasing debt and execution risk.
Motilal Oswal has valued the domestic module business, US module business and new businesses separately and arrived at a target price of Rs. 3,825. At the current level of around Rs. 2,700, this implies an upside of approximately 41 percent. The target is also only Rs. 40 below Waaree’s record high, suggesting that the old peak is achievable if its growth plans translate into earnings. But until margins, cash flow and new capacities show consistent progress, the journey back may remain uneven.
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