Solar stock in focus after company expects ₹60-₹70 Cr revenue from battery energy storage system

The shares of this leading renewable energy company are in focus after it laid out its plan for FY26 BESS projects. It is one of India’s largest renewable energy-independent power producers (“IPP”), and in this article, we will discuss more about it.

With a market capitalisation of Rs 15,082 crores, the shares of ACME Solar Holdings Ltd are currently trading at Rs 249 per share, down by 14.72 percent from its 52-week high of Rs 292 per share. In the last six months, the stock has delivered a positive return of 6.24 percent.

ACME Solar Holdings, located in Gurugram, is anticipating an annual revenue of Rs 60–70 crore, achieving a return on capital employed (ROCE) of 14–15 percent from its Battery Energy Storage System (BESS) projects in Andhra Pradesh.

A battery energy storage system (BESS) is a set of components that stores electricity in batteries, along with inverters, cooling units, plus software that governs how and when the stored power is utilised. 

The company has successfully landed two BESS contracts as part of NHPC’s 275 MW/550 MWh bid. This includes the 50 MW/100 MWh Kuppam project, which comes with a tariff of Rs 2.1 lakh per MW per month, and the 225 MW/450 MWh Ghani project at Rs 2.22 lakh per MW per month. Additionally, they will benefit from viability gap funding of Rs 27 lakh per MWh or 30 percent of the project cost, whichever is lower.

Viability Gap Funding (VGF) is a financial help from the government to support big projects that are useful but not fully profitable on their own. It covers part of the project cost to attract private investment. This makes it easier to complete important infrastructure work.

CEO Nikhil Dhingra emphasised that these projects are driven by customer needs and are being developed on client premises. This approach eliminates land and transmission challenges, allowing for quicker execution and reduced risk.

The company is planning to invest Rs 500 crore and aims to wrap up the projects within 18 months. Currently, ACME Solar has a net debt of Rs 7,500 crore, all linked to specific projects, with no debt at the holding company level.

Financial Highlights

The company reported a revenue of Rs 1,405 crores in FY25, up by 6.52 percent from its FY24 revenue of Rs 1,319 crores. However, the company reported a net profit decline of 64 percent to Rs 251 crore in FY25 from Rs 698 crores in FY24.

The stock delivered an ROE and ROCE of 7.50 percent and 8.40 percent, respectively, and is currently trading at a P/E of 56.68x as compared to its industry average of 37.56x.

ACME Solar Holdings Limited is a renewable energy company based in India that focuses on developing, constructing, owning, and operating large-scale solar power projects.

They also dabble in wind energy and provide a range of services, including engineering, procurement, construction, and maintenance. The company primarily collaborates with government-backed organisations at both the central and state levels.

Written by Satyajeet Mukherjee

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