Abhishek,
The 14-16% margin was on solar parks which Ujaas constructs as an end to end service. Going forward, the revenues and profit will surely decrease on an absolute basis as cost of solar panels is decreasing. The margins also face downward pressure due to increasing competition, but not a lot since the demand could be really huge. In the coming 12 months, in particular for the recently bagged orders I expect margin to be lower as the orders are more like EPC.
In May or June RBI announced that solar projects of upto 15 cr would qualify for priority sector lending. This was well known in the market, but I am just reiterating as I saw the same across couple of channels and in an interview by Vikalp Mundra. In particular, what this means is that for new home buyers, they can get a roof top solar loan as part of the house loan package at lower interest rate. For the household rooftop panels margins would be higher, but if they go with franchisee model, the margins could be less. I prefer the franchisee model. Hope they come up with a product where a professional comes to your home and assembles modular off-the-shelf components according to your requirement – in this case your terrace and budget/KW. As mentioned in concall, If they can get the installation time down to 1 day (concall said 1-2 days), it could be a huge hit.
If Ujaas implements about 26 MW in next 12 months then on a very conservative basis they would get 15 cr profit. With the O&M and a few small orders, 20+ cr. is surely on the cards. At 360 cr, on a 12 month forward basis, this does not seem expensive. However, while buying, I always tend to look at the MoS and downside. Bought more in the last week. Call me greedy.
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