These stocks had crashed earlier yesterday after US President Donald Trump-led government imposed preliminary 126% tariffs on solar imports from India, citing unfair manufacturing subsidies.
Motilal Oswal on solar energy stocks:
Motilal Oswal Financial Services highlighted that eligibility for the 126% duty rate depends on the country of origin of the solar cells used in modules supplied to the US. “In fact, the 126% tariff should apply only if the solar panels supplied to the US use solar cells manufactured in India,” the report said.
The domestic brokerage noted that Waaree earns about a third of its revenue from the US and does not use Indian-made solar cells for its US supplies. Therefore, this preliminary CVD of 126% is unlikely 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 only 1% of its revenue comes from overseas markets. Accordingly, Premier Energies also remains insulated from these developments, it added.
“From a broader industry perspective, India’s cell manufacturing capacity stands at ~27 GW under ALMM-II (versus a module manufacturing capacity of 162 GW under ALMM-I) and is still in the ramp-up phase. This is primarily aimed at meeting rising domestic demand. The current trajectory of cell capacity suggests limited availability of surplus to support exports at least through FY28 in a meaningful way,” the brokerage concluded.
Emkay Global about Waaree Energies:
Emkay Global Research said yesterday’s crash was caused by the significant negative sentiment for Indian solar players following the announcement. It noted that Waaree’s management has made it clear that the latest tax is unlikely to impact the company as the measures are determined by the country of origin of the solar cells and not the module assembly.The domestic brokerage noted that solar modules made from Indian solar cells represent less than 4% of total U.S. solar module imports, suggesting the latest tariffs are unlikely to have a significant market impact.
Emkay said the 126% CVD will largely have no impact on Waaree, which is largely supported by its diversified and FEOC-compliant sourcing.
“Waaree is not using cells from India or any affected country for its U.S. supplies, but instead uses sources from other countries where U.S. duties are lower, at approximately 10%. The company has ramped up its U.S. supplies, supported by diversified, FEOC-compliant sourcing, as it expands its U.S. capacities, including 1GW in Arizona (acquired) and 1.6GW expansion in Texas; this will likely reach total U.S. capacity by mid Bringing CY26 to ~4.2GW, sufficient to meet the current order book,” it said.
The domestic brokerage maintained its earnings guidance and reiterated its buy call on the shares with a price target 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 expressed by the experts are their own. These do not represent the views of The Economic Times)
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