– Waaree Energies Ltd. – Is it just the Dawn?

Summary of Wari Energies Limited Earnings Call Q2_2025

The solar industry is benefiting from strong tailwinds, driven by the fact that solar energy is the lowest cost energy globally.
Diversification of supply chains is another important demand driver, with countries like the United States and India pursuing a “China Plus One” strategy.
India has set a target of 500 GW of renewable energy by 2030, translating to 60-70 GW of solar power annually.
This target does not even include the potential demand from data centers, EV charging, and the expected hydrogen boom.
The combination of solar and batteries is expected to be a leading solution for firm and dispatchable renewable energy globally.
Solar is viewed as a multi-decadal growth story that is just getting started.

Wari Energies Limited reported revenue of ₹34,634.63 million in Q2 FY25, a 2.95% increase year-on-year.
EBITDA in Q2 FY25 was ₹61,393 million, up 14% year-on-year, with an EBITDA margin of 16.76%.
For H1 FY25, revenue was ₹71,543 million (up 2.67% year-on-year) and EBITDA was ₹12,539.26 million (up 14.74% year-on-year), resulting in an EBITDA margin of 17.51%.
The company has a strong order book of 20 GW, with a diversified customer base spanning exports, large customers, commercial and industrial customers, and retail customers.
The order book mix as of September 2024 was 27.5% domestic and 72.5% overseas.
Wari Energies Limited is focusing on robust execution skills to deliver on this order book.
The company is seeing impressive growth in production, with 3.3 GW produced in H1 FY25 compared to 4.8 GW for the entire FY24.

Exports constituted 27% of the business mix in FY25, down from 60% in FY24. This shift is attributed to cyclical factors rather than structural issues like competition.
The retail segment is also experiencing strong growth, currently contributing 23% of the overall business. Management believes it has massive growth potential.
Wari Energies Limited is expanding beyond solar into other energy transition areas like green hydrogen and battery energy storage systems.
- The company is setting up an electrolyzer manufacturing plant and plans to announce details within the next two months.
- The board has approved a ₹600 crore investment in renewable power infrastructure to support the broader energy transition strategy.

Management expects overall profitability to improve by 200 to 300 basis points due to backward integration through the new cell manufacturing capacity.
This guidance is based on a blended approach, and the profit potential could be significantly higher with full integration.
The company aims to maximize profit potential through strategic configuration of orders from its manufacturing facilities in India and the US.

Changes in US trade policy, particularly the potential for anti-dumping and countervailing duties, pose a risk to the company’s US operations. Management is monitoring the situation and expects clarity in January.
Competition from Southeast Asian countries is another potential risk, although it was not a factor in the reduced export mix this year.

Wari Energies Limited currently has 12 GW of module manufacturing capacity in India, distributed across various locations, with Surat being the largest.
The company has an additional 1.3 GW facility in Goa that began operations in July 2024 and is currently ramping up.
A 1.6 GW module manufacturing facility in Texas, USA, is nearing completion and is expected to begin commercial operations by the end of January 2025.
A 5.4 GW cell manufacturing facility in Surat is also under construction and is expected to commence commercial operations in mid-December 2024.
A 6 GW integrated facility in Odisha is in advanced planning stages, with land secured and design contracts awarded. This facility is expected to be operational in FY27.
The company is also evaluating additional capacity expansion in the US, potentially adding 3.4 GW of module capacity and 5 GW of cell capacity.
By the end of FY25, Wari Energies Limited expects to have a total manufacturing capacity of 15 GW (13.3 GW in India and 1.6 GW in the US).
By FY27, the company projects 21 GW of module capacity and 11 GW of cell capacity in India, plus potential additions in the US.

Wari Energies Limited is well-positioned to capitalize on the multi-decadal growth in the solar industry.
The company’s strong order book, robust manufacturing footprint, and expansion into new energy transition areas point to a bright future.
Management’s focus on execution, profitability, and customer satisfaction will be key to its continued success.
Changes in US trade policy and competition from Southeast Asian countries are potential risks that need to be monitored closely.

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