The shares of Waaree Energies gained more than 2% to trade at Rs 2,764.5 apiece, while Premier Energies shares rose around 2% to trade at Rs 741.60 apiece in the morning trading hours of Thursday.
These stocks had crashed earlier yesterday after the United States President Donald Trump-led administration imposed 126% preliminary duties on solar imports from India, citing unfair manufacturing subsidies.
Motilal Oswal on solar stocks:
Motilal Oswal Financial Services highlighted that the eligibility of the 126% duty is contingent upon the country of origin of the solar cells used in modules supplied to the US. “In effect, the 126% tariff should be applicable only if solar modules supplied to the US use solar cells manufactured in India,” it said.
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The domestic brokerage noted that Waaree roughly earns one-third of its revenue from the US, and does not use solar cells manufactured in India for its US supplies. Hence, this preliminary 126% CVD is not likely to have a material impact on the company’s earnings.
Premier Energies, on the other hand, has limited exposure to exports, the brokerage added, noting that just 1% of its revenue comes from overseas markets. Accordingly, Premier Energies too remains insulated from these developments, it added.
“From a broader industry perspective, India’s cell manufacturing capacity is ~27GW under ALMM-II (vs. module manufacturing capacity of 162GW as per ALMM-I) and is still in the ramp-up phase. It is primarily oriented toward meeting rising domestic demand. The current cell capacity trajectory suggests limited surplus availability to support exports, at least until FY28 meaningfully,” the brokerage concluded.
Emkay Global on Waaree Energies:
Emkay Global Research said that yesterday’s crash was driven by the significant negative sentiment for Indian solar energy players after the announcement. It noted that Waaree’s management has clarified that the latest duty is unlikely to bear an impact on the company, as the measures are determined by the country of origin of solar cells rather than the module assembly.
The domestic brokerage noted that solar modules made from Indian solar cells account for less than 4% of the total US solar module imports, suggesting that the latest duties are unlikely to have a significant market impact.
Emkay said that the 126% CVD will mostly not impact Waaree, which is largely supported by its diversified and FEOC-compliant sourcing.
“Waaree does not use Indian or any affected country’s cells for its US supplies, and instead sources from other countries where US duty is lower, at ~10%. The company has ramped up its US supplies, supported by diversified, FEOC-compliant sourcing while expanding its US capabilities, including 1GW in Arizona (acquired) and 1.6GW expansion in Texas; this is likely to take total US capacity to ~4.2GW by mid-CY26, sufficient to meet its current order book,” it said.
The domestic brokerage retained its earnings estimates and reiterated its ‘Buy’ call on the stock with a target price of Rs 4,260 apiece. This implies an upside potential of more than 57% from the stock’s previous closing price.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)