Add Shakti Pumps India Ltd for the Target Rs. 640 by Choice Institutional Equities
Key Conference Call Highlights
Demand & Outlook:
* PM-KUSUM 2.0 is highly anticipated, government effort towards the new scheme is underway
* Solar cell and solar inverter business to unlock new market under PM Suryaghar Yojna
Idustry & Positioning:
* Market leader; installed 87,000 solar pumps in FY26; 28,000 in Q4FY26 alone
* Solar rooftop business expected to improve, as inverters have 10% better efficiency as compared to peers
* Increasing distributors internationally. Sales in over 130 countries, focusing on improving exports
Growth Drivers:
* PM-KUSUM expected to be renewed with a larger outlay. SKPI expects announcement by end of Q1FY27E
Operations & Trends:
* Raw materials, such as copper, stainless steel and silicon sheets affected margin. Lower realization due to MTSKPY affected margins by ~4% points
* RM volatility short lived, management expects margin expansion, going forward. Company is not bidding for orders with unfavourable margins
* Mangement expecting 2–3% margin improvement due to operational leverage. Exports margin is 10% higher than domestic margin
Expansion & Execution:
* Managements guides for completion of pump-manufacturing and 0.5 GW module manufacturing by Q2FY27E
* Further, 2.2 GW solar cells manufacturing to be operational by FY28E
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