The renewable power space continues to be in focus. One of the key solar energy stocks, Waaree Energies, has seen significant traction. Its Q2FY26 profit grew 2x YoY while production surged 42% in the last 1 year. The company also maintained its FY26 EBITDA guidance of Rs 5,500–6,000 crore. Nuvama has a ‘Buy’ rating on the stock with a target of Rs 4,150 per share. This implies about 17% upside for the Waaree Energies share price from current levels.
Nuvama on Waaree Energies: High return potential
According to Nuvama, Waaree Energies’ valuation is a key point supporting the positive rating. Based on “the high potential returns and strong balance sheet, we reckon stronger OCF shall largely take care of higher capex needs. With Rs 5,100 crore of net cash, Rs 5,000 crore+ per annum EBITDA, the balance sheet stays strong,” they added.
Nuvama on Waaree Energies: Guidance intact
One of the key factors that Nuvama believes is supporting the Buy call is that the company retained its FY26 EBITDA guidance of Rs 5,500-6,000 crore. It expects cell production to rise in H2 and has Rs 25,000 crore capex lined up. According to the brokerage house, strong demand, capacity expansion, cell plant ramp-up, along with GST cut to 5% from 12% will help a further run-up in the share price.
Nuvama on Waaree Energies: Derisking strategy
Nuvama expects demand lift is likely from Waaree Energies’ data centres, GH2. Their estimates indicate that “a pass-through clause, a diversified supply mix, and strategic cell sourcing to help retain margins at the US facility where demand stays strong on tax credits.”
Beyond the US, it targets exports to the EU, the Gulf, the UK, Africa and Australia. Moreover, with 50% capex in FY27, they believe that Waaree Energies’ “multi-decadal opportunity” and Waaree’s backward and forward integration shall de-risk earnings concentration. The adjacent green businesses, such as the inverter facility, electrolyser facility, GH2 production and BESS capacity, shall enable it to capture what we believe may be a mammoth multi-decadal growth opportunity.”
Nuvama estimates Waaree’s EBITDA would surge at a 43% CAGR over FY25–FY28, driven by robust revenue growth. Their growth estimates are based on the company’s strong order book of 24 GW at the end of Q2FY26, valued at Rs 47,000 crore. Waaree’s EPC arm, Waaree Renewables Technologies (WRTL), is also growing rapidly, and Nuvama expects a strong order book of 3.5GW at the end of Q2FY26.
