Vantage point – eyeing integration at scale
We met Premier Energies (Premier)’s management during the company’s Investor Meet. Takeaways: 1) 1.2GW TOPcon facility has stabilised with >60% capacity utilisation and 25.2% efficiency. 2) Trial runs for 5.6GW module capacity at Seetharampur, Telangana and 4.8GW TOPCon cell capacity (of 7GW) at Naidupeta, Andhra Pradesh are expected by Mar’26 and Jun’26, respectively. 3) Management provided an update on the progress on ingot and wafer facility. It believes that the player with – i) scale; ii) integration; and iii) access to funding would have an advantage over competition. Premier is building 10GW of integrated solar manufacturing capacity and should be able to fund the entire capex with very little requirement of external funding. We firmly believe Premier is likely to do well. Reiterate BUY.
The ability to scale
Premier has shown its ability to scale and in building capacities – started with a 0.8GW PERC cell capacity and has added 1.2GW TOPCon facility. It is building 7GW of cell and wafer capacity at a single location; thus, leading to cost and cell efficiency. The location of the new plant was chosen to optimise cost of utilities.
The integrated ecosystem
Premier is building 10GW of ingot+wafer+cell+module capacity. Towards this end, it expects to reach 10GW module by Q1FY27 and 10GW cell by Q2FY27. It is also building and investing in: 1) ancillary ecosystem – inverter, BESS, transformers and aluminium frames; and 2) exploring the US market due to improved economics and incentives.
The strong balance sheet helps
Premier has one of the strongest balance sheets and is likely to generate ~INR 80bn of cash flow from operations over the next three years. Thus, it may not be bound to taking significant debt for the said capex over the given period.
The score is reflecting
At 3.2GW, Premier has one of the largest solar cell capacities in India. But, importantly, it has highest experience in operating and stabilising solar cell facility, a strong advantage over competitors.
Reiterate BUY
We reiterate BUY on the stock with TP of INR 1,320.
