Shares of Premier Energies, India’s second-largest integrated manufacturer of solar cells and modules, dropped sharply from their intraday high, declining 15% to hit a day's low of ₹997 per share.
The stock, which had surged 10% in early morning trade, reversed gains on a strong spike in volumes. For the quarter ending December, the company reported better-than-expected numbers, driven by higher-than-anticipated cell revenues and lower other expenses. Net profit surged 493% to ₹255 crore, while revenue grew 140% YoY to ₹1,713 crore, largely driven by a 25% QoQ increase in cell revenues.
Its EBITDA margin came in higher at 30%, exceeding street estimates of 23%. However, despite higher capacity utilisation (96% for cells and 74% for modules) and a favourable revenue mix (32.8% from cells—the highest in the past five quarters), there was no improvement in gross margins. Instead, gross margins declined by 160 basis points QoQ, which was a negative surprise this quarter, according to domestic brokerage firm Kotak Securities.
Kotak Securities also highlighted that the company's order inflow momentum was extremely strong in 3QFY25, with Premier securing ₹22.4 billion worth of orders during the quarter. The order book now stands at ₹69.5 billion, with ~36% of it coming from cell orders.
Currently, Premier enjoys a first-mover advantage in cells and maintains superior profitability in the DCR market (solar rooftop and solar pump scheme), which the brokerage expects to continue in the near term. Additionally, the applicability of ALMM for cells from June 1, 2026, remains a key factor to monitor for the domestic cell market and Premier.
Following the company's Q3 performance, the brokerage raised its target price on the stock to ₹840 per share, up from its previous target of ₹770 per share, but retained its 'Sell' rating on the stock.
It was reported that the company is pausing its plans to set up a 1-gigawatt (GW) solar cell manufacturing facility in the U.S. This decision follows the newly elected President Trump's order to halt Biden-era green policies, according to Reuters
The report stated that Premier and North American solar module maker Heliene had announced a joint venture in July 2024 to establish a U.S.-based solar cell manufacturing facility, aiming to capitalize on the incentives and tax credits for domestic clean energy manufacturing under the Inflation Reduction Act (IRA).
In January, President Trump ordered a halt to spending related to climate and infrastructure laws from the previous administration, paused tax credits for clean industries, and suspended new offshore wind power leasing. Simultaneously, he unveiled a plan to maximize U.S. oil and gas production and withdraw from the Paris Climate Agreement, as per the Reuters report.
Concerns over the U.S. stance on clean energy have weighed on shares of Premier, which have lost about 23% since hitting a peak in December, after listing in September. The company has nearly 100% market share in solar cell exports to the US from India.
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