Buy ACME Solar Holdings Ltd for Target Rs.357 by Elara Capital
All eyes on execution
ACME Solar Holdings (ACMESOLA IN) reported Q4FY26 revenue and PAT growth of 13% YoY each to ~ INR 5. 5bn and ~ INR 1. 4bn respectively, supported by strong generation growth and higher Other income. The company has a robust 8,071MW pipeline , including 17GWh BESS with 5,081MW under construction and 3,280MW already tied to a power purchase agreement (PPA ). ACME SOLA has commissioned ~2.3GW BESS capacity operating under the merchant mode and added 301MW FDRE projects in Q4 while fully commissioning its 100MW wind project. Generation increased to 1,720MU in Q4FY26 with capacity utilization factor (CUF ) at 26.9%, while management targets 10GW renewable capacity and 20GWh BESS by FY30. Total committed capex stands at ~INR 124. 8bn ,reflecting aggressive expansion and execution. We increase our TP to INR 357 on 9.0x FY28E EV/EBITDA on improved project execution . We retain Buy .
Top line up 13%; PAT rises 13% YoY:
Revenue from operations increased 13% YoY to ~ INR 5.5bn. EBITDA rose 10% YoY to INR 4.7bn. Depreciation went up 20% YoY to INR 1.2bn. Interest surged 64% YoY to INR 3.3bn. Other income climbed significantly to ~ INR 1. 6bn vs INR 523mn in the p ast year. PAT increased 13% YoY to ~ INR 1. 4bn
Robust project pipeline:
ACMESOLA has a total pipeline of 8,071MW, including 1 7GWh of BESS capacity, comprising 5,081MW of under -construction projects. Of total under construction projects, it has signed PPA for 3,280MW. It is yet to sign a PPA for 1,801MW under -construction projects. It has already commissioned ~2.3GW of BESS capacity , which is currently operating under merchant mode and short -term contracts by purchasing power during non -peak hours and selling during peak demand periods . It has fully comm issioned 100MW wind project, the largest wind project of the company . It has won a project of 301MW FDRE with SECI during the quarter, taking cumulative FY26 project additions to 1,401MW
Generation increases 49% YoY to 1,567MU:
Generation for Q4FY26 rose 13.7% YoY to 1 ,720MU. CUF for Q4FY26 stood at 26.9% in Q4FY26 vs 27.9% in Q4FY25. Management has set a target of 10GW of generation capacity and 20GWh BESS capacity by FY30. Total committed capex stands at ~INR 124. 8bn , including capex already incurred and purchase orders placed, while FY26 capex deployment stood at ~INR 64.5bn with outstanding purchase orders of ~INR 60.3bn , reflecting aggressive execution
Retain Buy with a higher TP of INR 357:
ACMESOLA enjoys robust growth roadmap, led by a strong execution history. The company currently operates 2,9 90MW of solar capacity, with an additional 5,081MW under development. It is focused on FDRE and hybrid projects to bolster returns and improve grid reliability. With plans to scale up renewables capacity from 2.9GW to 7.0GW by FY28, it is poised for significant growth, with a revenue CAGR of 6 3% and an EBITDA CAGR of 52% during FY2 6-29E. Currently, it trades at 10.2x FY28E EV/EBITDA and 13.1x FY28E P/E. We increase our TP to INR 357 from INR 317 on 9.0x (unchanged) FY28E EV/EBITDA on improved project execution . We retain Buy. We revise up earnings by 7% for FY27E and 4% for FY28 E . We introduce our FY29E earnings.
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SEBI Registration number is INH000000933
