Target: ₹4,000
CMP: ₹3,278.65
We initiate coverage on the solar cell and module manufacturing sector, with a Buy rating on Waaree Energies (WEL) and a TP of ₹4,000. Scale: WEL boasts unmatched scale and is a bellwether in the Indian cell/module manufacturing space.
WEL has responded swiftly to regulatory and macroeconomic changes as evidenced by its move to set up domestic cell capacity ahead of competitors in response to the government’s approved list of cell manufacturers (ALCM) and the planned expansion of its US capacity from 2.6GW to 4.2GW (by 4QFY26) in response to the changing tariff landscape. Integration:
Lastly, WEL’s presence across the solar value chain (EPC, BESS, inverters, green hydrogen) makes it an integrated player and places it well to pursue growth relentlessly.
Upside risks: Slower-than-expected ramp-up of industry cell capacity in FY27- 28; the government formalizing the localization directive for wafers and ingots (similar to ALCM).
Downside risks: Intensifying competition from large domestic players may pressure pricing and margins; Heavy US market reliance heightens sensitivity to policy, tariff, and geopolitical shifts; If backward integration initiatives (cells, ingot-wafer, and other upstream operations) fail to scale effectively, profitability and competitiveness may be undermined; the company’s aggressive foray into capital-intensive cell and ingot/wafer manufacturing increases exposure to execution and stabilization risks, potentially impacting timelines, costs, and near- to medium-term financial performance.
Published on November 7, 2025
