Premier Energies shares jump 5%; brokerage sees 23% upside potential
The domestic brokerage noted that Premier Energies imports most of its raw materials, with India's imports heavily concentrated towards China.
- Sep 24, 2025,
- Updated Sep 24, 2025 12:49 PM IST
Shares of Premier Energies Ltd (PEL) gained momentum in Wednesday's trade, rising 5.36 per cent to hit a high of Rs 1,067.30. YES Securities has recently initiated coverage on the stock with a 'Buy' rating, citing strong growth prospects and setting a target price of Rs 1,310, implying a 22.74 per cent upside from the day's high level.
According to YES Securities, "India's target of 500GW non-fossil capacity by 2030 and the increasing share of DCR mandates (mandatory domestic sourcing) provide a strong multi-year tailwind. Key programs such as the Production-Linked Incentive (PLI) scheme for high-efficiency modules, the ALMM mandate favoring domestic manufacturers, the PM-KUSUM scheme promoting distributed solar adoption, and state-level policies incentivising open access solar projects are structurally boosting domestic demand and localization."
The domestic brokerage noted that PEL imports most of its raw materials, with India's imports heavily concentrated towards China. "With the upcoming integrated facility and ambitions beyond manufacturing, the company is poised to witness cost and business synergies. The company is in discussions for PLI but there is no clarity on the plan as yet. As per our estimates, the backward integration will improve EBITDA margins by just ~50bps over FY25-28e."
YES Securities added that PEL has deliberately capped exports at ~4.2 per cent of FY25 revenues despite global opportunities, focusing instead on reliable domestic execution. The company's order book stood at Rs 8,600 crore as of June 2025, entirely domestic and fully backed by advances, providing visibility for the next 12–15 months. IPO proceeds of around Rs 1,290 crore have been parked in project-specific accounts.
"We believe PEL's Revenue/EBITDA/PAT to record a ~39/39/42 per cent CAGR over FY25-28e, led by a 42.8 per cent CAGR in volumes. We initiate coverage with a BUY and a TP of Rs 1,310, based on 22x FY28e (implied PEG of 0.5x) as the growth remains robust. The stock is currently trading at a PER of 22.2x/17.7x FY27/28e and at an EV/EBITDA of 13.2x/10.5x FY27/28e," the brokerage said.
However, it highlighted oversupply, project delays, policy and trade uncertainties, technological changes and raw material price volatility as key risks.
Shares of Premier Energies Ltd (PEL) gained momentum in Wednesday's trade, rising 5.36 per cent to hit a high of Rs 1,067.30. YES Securities has recently initiated coverage on the stock with a 'Buy' rating, citing strong growth prospects and setting a target price of Rs 1,310, implying a 22.74 per cent upside from the day's high level.
According to YES Securities, "India's target of 500GW non-fossil capacity by 2030 and the increasing share of DCR mandates (mandatory domestic sourcing) provide a strong multi-year tailwind. Key programs such as the Production-Linked Incentive (PLI) scheme for high-efficiency modules, the ALMM mandate favoring domestic manufacturers, the PM-KUSUM scheme promoting distributed solar adoption, and state-level policies incentivising open access solar projects are structurally boosting domestic demand and localization."
The domestic brokerage noted that PEL imports most of its raw materials, with India's imports heavily concentrated towards China. "With the upcoming integrated facility and ambitions beyond manufacturing, the company is poised to witness cost and business synergies. The company is in discussions for PLI but there is no clarity on the plan as yet. As per our estimates, the backward integration will improve EBITDA margins by just ~50bps over FY25-28e."
YES Securities added that PEL has deliberately capped exports at ~4.2 per cent of FY25 revenues despite global opportunities, focusing instead on reliable domestic execution. The company's order book stood at Rs 8,600 crore as of June 2025, entirely domestic and fully backed by advances, providing visibility for the next 12–15 months. IPO proceeds of around Rs 1,290 crore have been parked in project-specific accounts.
"We believe PEL's Revenue/EBITDA/PAT to record a ~39/39/42 per cent CAGR over FY25-28e, led by a 42.8 per cent CAGR in volumes. We initiate coverage with a BUY and a TP of Rs 1,310, based on 22x FY28e (implied PEG of 0.5x) as the growth remains robust. The stock is currently trading at a PER of 22.2x/17.7x FY27/28e and at an EV/EBITDA of 13.2x/10.5x FY27/28e," the brokerage said.
However, it highlighted oversupply, project delays, policy and trade uncertainties, technological changes and raw material price volatility as key risks.