Waaree Energies share reacts as Enel Green Power deal on verge of collapse

Solar panel manufacturer Waaree Energies' attempt to acquire Enel Green Power India is on the brink of collapse due to unresolved disputes over unmet conditions, as per a media report. Quoting sources, Economic Times reported that discussions have turned contentious, casting doubt on the completion of the Rs 3,500 crore transaction. The proposed deal included a cash offering of Rs 792 crore and the absorption of Enel's debt by Waaree Energies, Economic Times reported. This acquisition was seen as a strategic move to enhance Waaree's position in the renewable energy sector, but the ongoing disagreements threaten these plans.

The Waaree Energy stock opened at Rs 3,003.80 apiece on BSE, up 0.68 per cent. It gained further and was later trading at Rs 3,023 apiece, up 1.23 per cent.

Enel Green Power India, a subsidiary of Rome-based Enel, currently operating a platform with a net capacity of 640 megawatts, is part of Enel's strategy to exit the Indian market, following other European firms like Statkraft and Fortum. Enel's decision to sell its Indian operations is part of a broader strategy to streamline its global portfolio.

ET said Enel declined to comment, while Waaree Energies did not provide any statements regarding the deal's status. Business Today could not independently veriy the development at this point in time. 

The acquisition, initially announced by Waaree Energies in January, was intended to diversify its revenue and bolster execution capabilities in wind projects, Economic Times noted.  Waaree is the largest solar photovoltaic module manufacturer in India, boasting an installed capacity of 13.3 gigawatts. 

It recently came out with healthy set of June quarter results. It retained its FY26E Ebitda guidance of Rs 5,500–6,000 crore, which is two times YoY, led by strong demand, capacity expansion and ramp-up of the solar cell plant. Rising power needs from AI and energy storage shall support growth, Nuvama noted. 

Nuvama said Waaree’s backward and forward integration shall de-risk earnings concentration; The inverters facility shall start by Q4FY26 while G H2, electrolyser facility, advanced li-ion cells and BESS capacities would start in FY27E, enabling the company to capture what Nuvama believes could be a mammoth multi-decadal growth opportunity.

"We reckon stronger operating cash flow shall largely take care of its higher capex requirements of INR150bn. With INR75bn of net cash and Rs 5,000 crore-plus  p.a. Ebitda, Waaree’s balance sheet remains strong. We are cutting FY26E/27E EBITDA by 1%/1% to factor in higher opex. Reiterate our Braveheart ‘BUY’ with a target of Rs 3,646," Nuvama said on July 31.

Enel's decision to withdraw from the Indian market aligns with its broader strategy to deleverage and rationalise operations worldwide.