Premier Energies: What Nuvama says post Q1 results

Premier Energies has reported a revenue of Rs 1,820.70 crore for the first quarter of the financial year 2026, marking a 10% increase year-on-year and surpassing consensus estimates by 4%. However, the operating Ebitda stood at Rs 548.30 crore, a 53% increase from the previous year but 1% below projections due to inventory losses. This slight shortfall was attributed to unforeseen inventory challenges that impacted the overall financial performance, yet the company remains optimistic about future quarters.

Nuvama Institutional Equities highlighted that Premier Energies managed robust utilisation rates even amidst a planned shutdown, contributing to the revenue growth. The order book is valued at about Rs 8,600 crore, with 5.5GW in orders, primarily for modules and cells. This strong order book reflects the company's ability to secure significant contracts, ensuring a steady revenue stream for the upcoming periods.

Key to Premier Energies' growth is its Mission 2028, which aims to expand module capacity to 11GW, cells to 10GW, and ingots/wafers to 10GW, Nuvama said. 

Premier Energies has embarked on accelerated capital expenditure plans for its 12GWh Battery Energy Storage System (BESS) and 3GW inverters, expected to boost revenue in FY27. These strategic investments are poised to position Premier Energies as a leader in the renewable energy sector, capitalizing on emerging market trends, Nuvama said.

During the quarter, Premier Energies executed orders worth Rs 1,800 crore and secured inflows of Rs 2,000 crore. Despite challenges, the EBITDA margin was 30 per cent, down 249 basis points quarter-on-quarter but an improvement of 849 basis points year-on-year. Module utilisation was strong at 77%, while cell utilisation slightly dipped to 94% due to a brief shutdown. This operational efficiency underscores the company's resilience and adaptability in navigating operational hurdles.

Nuvama said Premier Energies' management remains optimistic about the domestic market, citing favourable government policies and advancing technologies as key growth drivers. Initiatives such as the PM Surya Ghar Muft Bijli, PM Kusum Scheme, and CPSU Scheme–Phase II are expected to fuel demand in the coming years. These policies are anticipated to create a conducive environment for growth, enabling the company to expand its market share.

The company’s strategy to protect margins from raw material price volatility involves variable contracts, which mitigate the impact of price fluctuations. Recently, cell prices in China rose by 30% in two weeks, potentially affecting non-DCR module prices. By leveraging flexible contracts, Premier Energies aims to maintain stable financial performance amidst volatile market conditions, Nuvama said.

Premier Energies' focus on the domestic market is driven by promising growth prospects and competitive pricing. The company anticipates the demand for DCR modules to rise significantly, with expectations of an increase from 15GW to 25GW/40GW by FY26/FY27. This anticipated demand surge is expected to drive substantial growth and reinforce Premier Energies' market position.

Nuvama Institutional Equities has not issued a rating but acknowledges Premier Energies' efforts to remain resilient in a competitive landscape. The brokerage has praised the company's proactive approach to capacity expansion and market adaptation. This recognition highlights Premier Energies' strategic foresight and commitment to long-term success in the renewable energy sector.