Ladies, and gentlemen, good day, and welcome to the Waaree Energies Limited conference call hosted by MUFG In Time India Private Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. I now hand the conference over to Mr. Nikunj Jain from MUFG In Time India Private Limited. Thank you, and over to you, Mr. Jain.
Thank you, Michelle. Good afternoon, ladies, and gentlemen. I welcome you to the Q4 and FY 2026 earnings conference call of Waaree Energies Limited. To discuss this quarter and full year's performance, we have from the management Mr. Jignesh Rathod, Whole-Time Director and CEO, Mr. Abhishek Pareek, Chief Financial Officer, Mr. Varun Goenka, President, Growth and Strategy, and Mr. Niraj Vora, Vice President, Investor Relations. Before we proceed with the call, I would like to mention that some of the statements made in today's call may be forward-looking in nature and may involve risk and uncertainty. For more detailed disclaimer, kindly refer to the investor presentation and other filings that can be found on company's website and stock exchanges. Without further ado, I would like to hand over the call to the management for their opening remarks, and then we will open the floor for Q&A.
Thank you, and over to you, sir.
Thank you, Nikunj. Good afternoon, ladies, and gentlemen. This is Jignesh. Thank you for joining us for the Q4 and full year financial year 2026 earnings call of Waaree Energies Limited. I shall be referring to the investor presentation that has been uploaded yesterday on stock exchange. If you have the presentation handy, it will be great to follow the conversation. Let's start with the slide number three. I am delighted to share that Waaree Energies Limited has delivered yet another year of record-breaking performance, this time across the full fiscal year. Our revenue from operations in this year has recorded a growth of approximately 84% year-on-year, reaching INR 26,537 crores. Operating EBITDA grew 117% to INR 509.09 crores with an operating EBITDA margin of 22.27%.
Our PAT for the year doubled, growing over 101% to INR 3,884 crores. I want to highlight that our reported total EBITDA of INR 617 crores has surpassed our guidance range, which is given earlier, INR 5,500-INR 6,000 crores for FY 2026, which reflects the strength and consistency of our execution. Moving to slide number four, which highlights our capacity leadership and the scale we have achieved. Our total module manufacturing capacity now stands at approximately 26 GW, making Waaree the largest non-Chinese module manufacturer in the world. Our cell manufacturing capacity continues to be fully operational at 5.4 GW, the largest cell manufacturing facility in India. Our order book continue to remain robust to approximately INR 53,000 crores.
We have planned CapEx of approximately INR 30,000 crore across verticals to fuel the next phase of our growth. I'm pleased to share that we continue to maintain a very healthy ROCE and ROE for 32.4% and 29% respectively. On slide number five, we show the strong production ramp-up that has powered our results. Our module manufacturing for the year, full year has reached to record 12.6 GW. It's approximately INR 2 crore module. That is 56,000 modules every single day we have produced. This is a growth of 77% over the FY 2025. We sold approximately 12 GW of modules during the year. Our revenue mix remains healthy and well-diversified. Utility, IPP, C&I contributed 34.7%, overseas at 33%, retail at 20.8%, and EPC at 11.6%.
I want to particularly call out our retail segment, which delivered revenue of INR 5,515 crores in FY 2026, a growth of 84% year-on-year. The traction in our B2C business continues to be very strong, this is a segment we are very excited going forward. On slide number six , we look at the Q4 more closely. Module production stood at 4.2 GW, a 104% increase year-on-year. Cell production for the quarter was 0.7 GW, we sold 4.1 GW of modules in this quarter. Our order book, as I mentioned, stands at approximately INR 53,000 crores, up from INR 47,000 crores at the end of Q4 FY 2025. The current order book does not reflect the retail portion, which is nearly represents approximately 20% of our revenue contribution.
Our record pipeline remains robust at 100+ GW. Moving to slide number seven, I am pleased to walk you through some of the key strategic initiative we have undertaken during the quarter. On the growth and investment front, we completed the acquisition of a strategic stake in United Polysilicon, Oman-based company, securing a long-term, fully traceable, non-Chinese supply of polysilicon. This is very important step for us from a supply chain de-risking standpoint. Our subsidiary, WRTL, has announced the acquisition of approximately 55% stake in Associated Power Structures Limited for approximately INR 1,225 crores. This marks our entry into the transmission and distribution segment, which is natural adjacency for us. Our board has approved a CapEx of INR 3,900 crores PV glass manufacturing for capacity of 2,500 TPD.
Glass accounts approximately 23% of module cost and 75% of module weight. This backward integration will significantly strengthen our cost competitiveness and supply chain independence. On the capacity side, we have commenced construction of our 10 GW ingot wafer facility at Nagpur, which is with a CapEx of INR 6,200 crores. We have commissioned an additional 3 GW module manufacturing capacity, Samakhiali, Kutch. A large part of our module manufacturing capacity has now moved to G12 and G12R technology. Of course, it's TOPCon, which is the latest generation of the cell and module formats. All our plant capacity expansion in batteries, solar cell, ingot wafers, inverters, and green hydrogen electrolyzers are progressing as per schedule. We are very much on track on all the projects. On slide number eight, we talk about what makes Waaree different. The winning edge.
Our integrated business model provides full stack vertical integration, starting right from polysilicon to ingot, wafer, cell, module, and all the way to EPC and ODM. We are also pursuing horizontal integration across energy storage, inverters, transformers, green hydrogen, electrolyzers, and many more. Our speed of execution remains a key differentiator. We've expanded our module manufacturing capacity multi-fold to 25.68 GW within seven years. We built 1.6 GW greenfield module manufacturing capacity in U.S. in just 12 months, amongst the fastest of its kind. We are also on track to expand our U.S. manufacturing capacity to 4.2 GW over the next six months, ensuring local supplies in U.S. Our financial discipline is well established. We have maintained a debt to equity ratio of less than one, despite heavy CapEx cycles for nearly a decade.
Our capital allocation follows a simple principle, book and build, which means every rupee we deploy is backed by confirmed demand and a clear path to returns. That's our commitment, growth with discipline. We continue to de-risk our business by ensuring no single customer, market or segment define us. Today, our retail service and overseas segments contribute 60%-70% of revenue, a testament to this approach. We are taking it further throughout online sales, market expansion, and strategic technology tie-ups, continuously broadening our revenue base and reducing concentration risk. If you see slide number 10, that is where I want to spend a moment to talk about a bigger picture of where Waaree is heading. We are emerging as India's only fully integrated energy transition player. We call it this our journey from Waaree 1.0 to Waaree 2.0.
With approximately $3.5 billion of committed CapEx, we are building our capabilities across the entire energy value chain. Post completion of all the committed CapEx, Waaree 2.0 will have approximately 28 GW of module, 15.4 GW cell, 10 GW ingot wafer, 20 GW h of battery, which is includes the cell, pack, containers, 4 GW of inverters, 1 GW of green hydrogen electrolyzer, 20,000 MVA of transformers, 2,500 TPD glass, plus smart meters and T&D capabilities. Our integration across the entire energy value chain, along with structural demand, is expected to expand total addressable market by 4x , from approximately $1 trillion today to approximately $4 trillion by 2035.
Our end-to-end integration, unmatched scale, and ability to deepen client wallet share position us uniquely to lead India's green revolution and serve as a comprehensive solution provider to our customers globally. All in all, last year has been landmark year for Waaree. The results are exceptional. Our execution is on track across all the projects, and runway ahead of us continues to expand. We look forward to a very exciting financial 2027 or beyond. With that, I would like to hand over our CFO, Mr. Abhishek, for his remarks.
Thank you, Jignesh, sir. Good afternoon, everyone on the call. I will now take you through the next set of slides, which cover our adjacent businesses, demand outlook, quality credentials, and retail engine, all of which together are building the foundation of Waaree 2.0. Let me begin with slide number 10, which our CEO has briefly introduced. This slide captures the full picture of our transition. Today, Waaree is not just a solar module company. We are systematically building out every critical component of the new energy value chain. From entire solar value chain to BESS, electrolyzers, inverters, transformers, solar glass, smart meters, and T&D, we are constructing an energy transition ecosystem that no other company in India offers today. We are deploying $3.5 billion of CapEx over the next two years to scale core capacity, expand into adjacent value pools.
This positions us to capture a TAM that is expected to expand roughly 4x from approximately $1 trillion today to $4 trillion by 2035, a decadal long journey with a clear runway. Translating into a multi-year runway of compounding revenue growth. The strategic logic is very simple. Every new capability we add deepens our wallet share with existing customers and also opens up new customer segments. Let me now walk you through each of these adjacencies in detail. Slide number 11, which covers our inverter business. Inverters are the brain of any solar installation. They control power flows, capture critical user data, and are increasingly becoming central to energy management. The global solar inverter market is currently approximately $16 billion annually, and is expected to grow at roughly 11% CAGR over the next decade, reaching approximately $46 billion by 2035.
In India, this market stands at approximately $1 billion today and expected to reach $1.6 billion by 2035. What is important to note here is that India is emerging as a reliable alternate to China for U.S. and EU buyers, driven by geopolitical stability and free market compliance. Energy security and data localization are becoming key drivers. Under the Digital Personal Data Protection Act, having India hosted data builds significantly stronger customer trust. Our positioning in this segment is strong. We have planned capacity of 4 GW at our Sarodhi facility in Gujarat with a CapEx outlay of approximately INR 180- odd crores. Phase I of 3 GW has already commissioned. Remaining 1 GW shall be operational in current financial year.
What makes this particularly exciting for us is that we are capitalizing on our existing retail outreach to provide a one-stop solution. Modules, inverters, and certainly going ahead, storage, all under one brand. There's no incremental go-to-market build required for this. The channel is already in place. Moving to slide number 12, we talk about transformers. Transformers are backbone of grid expansion, and with the massive build-out of renewable energy capacity, the demand for transformers is only going to accelerate. The global transformer market is currently approximately $68 billion annually, growing at roughly 7% CAGR, expected to reach around $130 billion by 2035. In India, this market is approximately $3 billion today and projected to reach $6.5 billion annually by 2035. Under the Revamped Distribution Sector Scheme alone, the total outlay is approximately $33 billion.
There's a huge supply gap, approximately 5.9 lakh distribution transformers have been sanctioned, versus only 1.7 lakh installed, which tells us the scale of this opportunity. At Waaree, we have current transformer capacity of around 4,000 MVA, and we are adding up another 16,000 MVA of capacity, taking total to 20,000 MVA in current financial year, with a CapEx outlay of around INR 192 crores at our Alwar facility in Rajasthan. We are expanding the product portfolio to include distribution transformers, inverter duty transformers, extra high voltage transformers, all under one roof. We continue to build out order book in this segment, and have already secured orders from global MNCs, which validates our quality benchmarks and global aspirations. Slide number 13.
It covers what I believe is one of the most important growth segments for us, battery energy storage system. BESS is emerging as core enabler of grid stability and renewable integration. The numbers that are here are truly compelling. Global annual BESS addition is expected to reach approx 1 TWh by 2035. Right now, the number is 247 GW in 2025, almost 4x growth. India's BESS install capacity is expected to increase from around 1 GW in 2025 to 236 GW by FY 2032. That means India is expected to add around 50 GWh annually between 2027 - 2035. This is primarily driven by BESS and the EV segment. Grid stability concerns and containment issues are accelerating the demand.
With the mandatory requirement of minimum two hours by the Government of India for PV tenders, this policy framework is now firmly in place to support large-scale adoption. Our BESS capabilities are being built out with a planned capacity of 20 GWh . Out of that, phase I, 3.5 GW is expected in the current financial year, and phase II of 16.5 GW by next financial year. The total CapEx outlay is approx INR 10,000 crores. This facility will emerge as India's largest integrated advanced cell chemistry cell and pack manufacturing hubs. Our offering will include LFP cells, battery packs and containers, and we are also pursuing further backward integration to indigenize a large part of the value chain. We are targeting data centers, utilities, C&I customers and the residential segment altogether. Moving on to slide number 14.
Middle East crises have only highlighted the importance of energy securities by alternate means, with hydrogen blending offering a de-risked infrastructure, info light entry into the green molecule economy with predictable demand visibility and government-backed incentives. All of these positions early movers in electrolyzers, blending station and hydrogen-ready turbines and pipeline retrofits to capture the outsized returns as energy transitions shift from voluntary to existential. At Waaree, we are targeting a capacity of 1 GW at our Dhundi facility in Gujarat in current financial year and a planned CapEx of INR 676 crores. We have secured the electrolyzer PLI for INR 444 crores and a hydrogen PLI for approx INR 510 crores. Our strategy is very clear. We are starting with electrolyzer manufacturing, moving to build on operate projects, and then transition to green derivatives.
Our target segments include refineries, fertilizers, chemicals, steel plants, specialty chemicals, and mobility. On slide number 15, we are laying out our path to solve land and connectivity related issues that at times slow down the renewable power adoption in the country. In last 12- 15 months of time, we have signed PPAs worth 713 MW with credible utilities and global C&I customers. We've also secured connectivity for developing approx 8 GW of projects, comprising solar, wind, and BESS across central and state transmission networks. Our total commitment in this segment stands at INR 3,250 odd crores, and we are building a diverse, value-driven IP portfolio for our marquee clients, which creates long-term order visibility across all the manufacturing segments within the group. Moving to slide 16, we talk about PV glass. This is again exciting story.
Glass accounts approximately 20% + of our module cost and one of the most critical component influencing the module quality, efficiency, durability, and yes, the cost. India's PV glass supply has gap of approx 5,500 ton TPD as of now. Over the next five years, this is going to increase. At Waaree, our board has approved 2,500 TPD capacity, which is enough to produce approx 16 GW, 17 GW of modules per annum at a plant CapEx of INR 3,900 crores. Captive demand for FEOC compliant PV glass, it secures offtake from day one because of our U.S. presence and U.S. facility. At target yields, our landed cost undercuts Chinese supply, building a structural margin cushion into the current pricing. We are converting a dependency into a pricing power, and that is opportunity which we are excited about. Slide 17.
We grew our EPC business, which is fully integrated already from concept to commissioning to long-term O&M, all under one roof. The model is already proven to the ground. We have executed more than 5 GW worth of projects and under execution, around 3 GW to all. Currently, our acquisition of APSL is ongoing, with which we will be extending the same discipline into transmission and distribution EPC as well. This gives us nearly 3x revenue visibility ahead of us in a market that generally lacks reliable large-scale EPC partners. Moving to slide 18. This is where our long-term confidence truly stems from the demand outlook. Globally, solar capacity reached approx 2.5 TW in 2025 and expected to reach 8 TWh by 2035, making solar the single largest contributor to the renewable power growth.
Globally, solar additions are expected to grow from around 700 GW in 2025 to 860 GW in 2030 and around 1 TW by 2035. Again, a large opportunity. Domestic front, India adds 44.6 GW of solar capacity in FY 2026, taking cumulative solar capacity to around 150- odd GW. India solar additions are expected to grow from 38 GW in 2025, 44 GW in 2026 to around 72 GW by 2030. Our estimate is to grow 100 GW annual capacity deployment in 2035. The evolving geopolitical landscape has only strengthened the energy transition imperative, and Waaree is at the center of it. Moving to slide number 19. At Waaree, solar is the core, and from that core, we are building the entire energy value chain.
Upstream, we are integrating all the way back to polysilicon, and on downstream, we are extending into storage, electrolyzer, inverter, transformation, transformers, DNV, et cetera. One integrated platform owned end-to-end, built to capture value wherever the transition flows. On slide 20, we talk about something that is not always visible in the financial numbers, but absolutely critical for sustained competitiveness. Our quality and bankability leadership. These are not just one-time certifications, but reflect a continuous multi-year journey of product performance, process optimization, field validation, and financial strength. With over 50+ global and domestic certifications, we have built entry barriers that are hard for others to replicate. Moving to slide number 21. Again, something that I'm really proud of. India's deepest solar retail engine.
We have built a scalable, unified distribution engine that covers today 27 states, 200 districts, and more than 600 franchise over 2,500 authorized service partners. Huge number. We have deep presence across solar demand clusters in India. Our strong last mile access through our installers and franchise network gives us the ability to influence customer decisions at the point of sale. The channel leverage is enormous. The same distribution engine that sells modules today can enable rapid rollout of kits, BESS, inverters, and future products with no incremental go-to-market build-out. Every additional product we push through this channel, it reduces our customer acquisition cost further. This is why I feel that we are building something large. Finally, on slide number 22, the result speaks for themselves. Waaree is India's number one solar retail brand with highest national share in calendar year 2025.
Around one in every six installations in the country carries Waaree name. Our persistent actions in brand building from regional advertising to partnership with cricket teams on ground awareness and digital marketing that are translating direct entry into the market penetration and brand visibility. The engine has been built and moat is establishing. Now, I will quickly brief upon financial numbers. For the full year, our consolidated revenue from operations stood at INR 26,536 crores, reflecting a healthy growth of 83.7% year-on-year. Operating EBITDA came in at INR 5,908 crores, registering a growth of 117%, with margins improving to 22.27% versus 18.84% in the previous financial year. Profit after tax was INR 3,884 crores, growing by 101% compared to last year.
ROE for the year was 29%, while ROCE was 32%. Turning to Q4. We closed the quarter with revenue from operations of INR 8,480- odd crores, marking year-on-year increase of 111%. Operating EBITDA for the quarter stood at INR 1,576 crores, up by 70% margins. Profit after tax for the quarter was INR 1,126 crores compared to INR 644 crores in Q4 FY 2025. I now hand over call back to our CEO.
Thank you, Abhishek. Looking ahead, our priorities are very clear. Continue scaling capacity in line with the demand, deepen integration to improve the cost competitiveness, expand across markets, and keep investing in technology and innovation. To sum up, financial year 2026 has been a year of strong progress. We have delivered on growth, strengthened our position, and built a solid platform for future. With strong industry tailwinds and a clear strategy, we remain focused on consistent execution and long-term value creation. We continue to remain upbeat on our growth prospect and guiding for operating EBITDA of INR 7,000 - INR 7,700 crore for financial year 2027. Thank you for your continued trust and for being with us on this journey. With that, I would now like to request the operator to open the floor for questions.
Thank you very much, sir. Ladies, and gentlemen, we will now begin with the question- and- answer session. Anyone who wishes to ask questions may please press star and one on their touchtone phone. If you wish to withdraw yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. Ladies, and gentlemen, we will wait for a moment while the questions are assembled. The first question is from the line of Arun Kailasan from Geojit Investments Limited. Please go ahead.
Yeah, hi. Thank you for, you know, letting me to ask these questions and, you know, congratulations on the numbers, management. I just wanted to know, like, why there was a very steep decline in the operating EBITDA margins in this quarter, versus, you know, the previous quarter. If you could also give us a color on, like, the realizations of the current run rate of realizations for the DCR, non-DCR modules, as well. Thank you.
Thank you for that question, Mr. Arun. On question about the margins this quarter compared to last quarter. Over last quarter, we have seen two things which no one has envisaged. The war in the Middle East and the crisis of commodity prices. Over last quarter, the biggest impact which has taken up was the impact of silver pricing and copper pricing, which has in a way turned up, taken some bit of our margins. More important to note here, because last quarter there was also some impact on logistics cost. There was limited movement of ships inbound as well as outbound. Out of that, the cost of freight has gone through the roofs like never before. The mix of the sales again adds up to this.
If you look at our mix of sales of last quarter compared to a quarter previous to that, you will realize that our revenue from the overall overseas operations, vertical operations, has come down compared to Q3. Three put together has impacted the margin. One thing I would like to add here, Arun. Since market has normalized already now, customers have started factoring the increased price in the new commodity levels already. We really foresee the implication that price have adjusted for the higher commodity prices already as we speak. The another question of DCR, non-DCR market. Like currently, if you look at the non-DCR market for us, there are two segment in non-DCR. One is utility and another is our retail segment.
Utility segment, the prices ranges between INR 15-INR 16 with the, I would say, addition of the higher commodity price. Now the retail prices go within incremental INR per watt peak premium to us. The DCR pricing ranges in the range, which is the mono PERC or TOPCon between INR 21-INR 22. Hope that answers.
Okay. Also I just wanted to know, like, you know, granted that, you know, Waaree is considerably shielded from the impact of any of the Anti-Dumping Duties per se in the U.S. market. Do you think that, you know, I mean, do you see any sort of any panic, negotiation with regard to it, like, you know, changes in pricing or, you know, even different deliveries in that particular market as a result?
Thankfully, ahead of time, you know, we were able to start our production in U.S. itself. The 1.6 GW facility started last year has already ramped up, and another 2.6 GW worth of new facilities are going to go live over the next six months of time. We will have approx 4.2 GW of U.S. local capacity for distributing in the local U.S. markets. That insulates us from the impact of import duties on panels. At the same point in time, if you look at the export market also from India, since we have already established our supply chains ahead of time to alternate markets, including the markets from Africa and Europe wherein we are sourcing our sales from, that again insulates us from the duty on solar cells originating from India.
That's how we have been able to sail through the entire duty scenario. I think we are in best position today with local 4.2 GW capacity within next six months of time.
Thank you. Okay. I was also wondering.
I'm sorry to interrupt you, sir. Sir, I would request you to kindly rejoin the queue for follow-up questions.
Just a follow on this same question.
Sir, I would request you to kindly rejoin the queue. We have a long queue today.
Okay. Okay. Thank you.
Thank you, sir. Thank you. Ladies, and gentlemen, in order to ensure that the management will be able to address questions from all the participants in the conference, kindly limit your questions to only one per participant. Should you have a follow-up question, please rejoin the queue. The next question is from the line of Abhishek Nigam from Motilal Oswal. Please go ahead.
Yeah, hi. I want to check on the G12R transition which you were doing in the last quarter. My understanding is there was a bit of a shutdown on some of the lines in the last quarter. Is that complete or there could be some spill-over in the first quarter as well?
Yeah. We have converted three lines to G12R. Currently 11 lines are working. Three lines are mono PERC. Three lines we have converted to G12R. It is in ramp-up phase. Five lines is continue running into the M10R TOPCon.
Okay. These five will probably get converted in the first quarter, right?
Yes. Yes. Phase manner. Once the three lines will get stabilized, runs fully, slowly we are ramping up.
I mean it could be 1 Q, it could be 2 Q, depending on when this goes through.
Yeah. Yes. One quarter.
Okay.
I understand, Abhishek, for you to take a note of one thing which is very important here is we are expecting to go back to the C of that we have achieved in the month of January, 330 MW of monthly number in next two months time. In fact, since we are shifting to G12R now, we will have the upset of higher efficiency and higher realizable value from the same set of cell. You can expect in terms of MW and in terms of realization, we higher number by 10%-12% out of the current revision which has happened. Hope that clarifies.
Okay. That works. Thanks. I'll come back in the queue.
Thank you. The next question is from the line of Ravi Dharamshi from ValueQuest. Please go ahead.
Yeah, hi. Thanks for taking my question. Just want to understand why was the export mix so low in this particular quarter, and would that still be the case going forward? Also on the outlook for order book accretion on the export front.
Hi, Ravi-ji. The question of export being lower this quarter. Last quarter between January to February, you know, we have seen a lot of impact on the logistics delays all across. Ships were getting delayed. The stack to load material on ships are also getting lower because of the congestion of these large ships in the Middle East markets. Because of that, what has happened is lot of lots which were being manufactured and prepared for the export market could not be shipped. If you look at our balance sheets also, you will realize that the inventory overall has gone up largely because of the logistics issues. The same is going to get converted within current quarter.
That has not allowed us to do as much exports as we generally do every quarter and has changed our revenue mix as well. In terms of the order book question, like, we have mentioned that we have got INR 53,000 crore worth of total order book already. In terms of the order book detailing how much is export. For us it is not export, it is overseas revenue because we have around 1.2 GW capacity in U.S., which will be 4.2 GW in next six months of time, wherein we are delivering and manufacturing and delivering both in U.S. Some bit will continue as exports from India.
In the total order book of INR 53,000 crore, around 65%-70% is from the overseas long range order book to be delivered over next three to four years of time. What is not accounted in this INR 53,000 crore order book is the retail business, which is approx 20% of our total revenues.
Right. Thank you. Just one follow-up question. What is the fundraise purpose of the fundraise?
We have taken the enabling resolution to raise up to INR 10,000- odd crores. We will soon also be laying out the request for approval from the shareholders for raising this capital up to INR 10,000- odd crores. That request will also cover up all the objectives of the fundraise.
Thank you.
Yes. Hi, Ravi.
Thank you.
This is Varun here. I just want to clarify on this fundraise. I think the Waaree 2.0 transition that Abhishek and Jignesh spoke about essentially means a much bigger opportunity, both in terms of the core module and the adjacencies that is opening up, both in terms of India demand and global demand. For us to both in terms of increase the customer wallet share, de-risk our supply chain, localize our BOM, entire materials, and the support of government in terms of policies. For example, the glass manufacturing is essentially an outcome of the duty protection now that the government has introduced, that you would be aware of. The margins earlier were much lower, but now the margins are very high and ROCE are very healthy, which essentially has encouraged us to take that CapEx.
This fundraise is to deepen our entire platform journey, both horizontal and vertical, and also to embark on the entire materials backward integration. This will lengthen our growth curve, protect our margins and ROC over much longer period. Thank you so much.
Thank you, sir. We will take the next question from the line of Aritra Banerjee from Nomura. Please go ahead.
Yeah. I hope I'm audible.
Yes, sir.
Yeah. Please proceed.
Yeah. Thank you for taking my question. My first question is on the, you know, glass manufacturing side. I just wanted to understand, like, you know, what benefits we can expect from the glass manufacturing side in terms of, you know, manufacturing cost and will it help in any sort of boost on the margin front?
Thanks for the question, Mr. Banerjee. I think before I jump off on the commercial benefit, the more important element here is, first is that for our entire supplies in the U.S. market, we require FEOC compliant material. This glass manufacturing will ensure that we have continuous supply under controlled environment from India, which will enable the U.S. glass feed-in for the factory. Secondly, for our India factory also, since we have PLI benefit from the government, the localization of glass is going to ensure that we start getting our PLIs soon. Thirdly, the current ROC and ROE in glass because of the cost curves and local manufacturing benefits, including the protection by the government through duties of long term is making a lot of sense. Glass is around 20% + of the total cost that we have.
If we are able to in-house the glass and ensure that we, apart from sell, also control the cost curve of the second biggest component in bill of material, it will ensure that we are completely independent of these moments, the glass. In recent example, last quarter, glass was one of the case wherein prices rise sharply because of some problem or some trouble in the Middle East and China. That way we are going to leverage on our capabilities to consume the entire glass that we manufacture. In fact, the capacities announced are much lower, are lower than what we will be requiring for our own feed and stock. We will continue to even buy out from markets and also have in-house sourcing of glass on the sales production. Hope that helps.
Yeah. Understood, sir. I have just two more questions. Regarding the BESS business-
I'm sorry, sir. I'm sorry to interrupt you, sir. I would request you to kindly rejoin the queue. There is a long queue who are waiting to ask questions, sir.
Okay.
I would request you to kindly rejoin the queue for follow-ups, please. Thank you. We'll take the next question from the line of Sweta Jain from Anand Rathi Shares and Stock Brokers Limited. Please go ahead.
Just wanted to understand two things. One is how would the cost matrix change if you are importing cells from Ethiopia or any other African market versus Indonesia? Hello?
Yeah. On the day of announcement of duties by U.S. government, my chairman has addressed this question, although I'm repeating here. It depends on the U.S. duties onto the each countries. In U.S., the fee on the solar module is based on the solar cells where it produces. Where the junction has been produced, that country will be considered as the origin of the solar modules. Ethiopia cells will have a 10% duty on U.S., wherein Indonesia is having 34% + 1 0%, like 44%.
Yeah. for you to understand in a way, Sweta, I think I'll try to make a little easier for you understand.
Mm-hmm. Mm-hmm.
For example, if like, if you are importing from Ethiopia versus let's say from Indonesia, we will end up paying duty on the entire product if we consume the product that sells from Indonesia. Similar is the case currently with Indian cells also. If you can use Indian cell for manufacturing in U.S. or either export from Indian market, we will have to pay up the recent announced duty of 123- odd % on India.
Okay.
While Ethiopian cells will not have those duties.
Why I'm asking this question is, in the recent ADD order, the Anti-Dumping Duty, apart from the CVD that came in earlier, the ADD specifically mentions India and Indonesia. With that into perspective, this cost dynamics would have really changed, you know, the last, I think what we'll call is the cell imports we did was majorly from Ethiopia and then Indonesia. Are we looking at new markets considering this cost cap would have increased towards like 10% or 40%? Indonesia is now more than 100% with ADDs at least.
Indonesian cells we are not using for module shipping to USA. That we are using for India.
Okay.
Ethiopian cells we are using for U.S. market.
Mm-hmm. Okay. Understood.
In fact, Sweta , to add up to the context, if you look at the current build out cell capacity, you will see that there are some bit of capacities which are building out in the Middle East also, where there will be new cell capacity. For example, in Oman, they have acquired the polysilicon company stake, right, strategically. Therein also in Oman also we see some capacities are coming up for sale. If there are cells available from Oman being brought in India to manufacture module and export to U.S., the duty will be applicable is what duty would have been applicable from Oman, which is 10%. That way, as we go on deeper in the supply chain, we keep on diversifying our source of cells for the exports in U.S. or manufacturing.
We keep ensuring that our supply chain pocket is expanding, and we have been doing this all through day and night.
Got it. Thank you. I will come back in the question queue. Thank you so much.
Thank you. The next question is from the line of Sabri Hazarika from Emkay Global Financial Services. Please go ahead.
Yeah. Yeah. Good afternoon. Just wanted to get some more color on the guidance that you have given, INR 7,000 -INR 7,700 crore. Looking at what you've mentioned that the cell will take probably one or two quarters to convert fully to G12R. I think module capacity also we are like close to 26 GW, which will probably go up by another 2 GW. I mean, how does how do we achieve this 20%-30% growth? A breakup between how the revenue would be, how the production volume should be, what kind of margins. Some color on that. Thanks.
Hi, Sabri. Thanks for the question. I think for someone to understand how it works is like FY 2026 our operating EBITDA was INR 5,908 crores. The guidance is INR 7,000-INR 7,700 crores. A range of around 20%-25% of growth on the absolute level of EBITDA numbers. In terms of the cell production, right? The current as our CEO just mentioned over call that in a quarter's time, the cell production will not just normalize to what it was a quarter back. It will actually have an effect of upside of 10%-15% as well. Additionally, in H2, our 10 GW cell is also going live.
Which means in second half of this year, our capacity, which will be giving in cell for our own module production, is not 5.4 GW anymore. It is 15.5 GW, more than sufficient for every module that we manufacture and sell in this country. Which means the impact of margin expansion, because of the regulatory and DCR reasons, will start coming in big way in H2. H1, we will see a transition from 5 GW-1 5 GW. That's how the number will also play out.
Okay. you're expecting cell to be adding. ingot wafer would be in FY 2028, right?
Yeah. Ingot wafer will be in FY 2028. Also to further clarify here, since we've given you the consolidated guidance of EBITDA. This number also factor in the pre-startup cost of many of the projects which are under construction and going live this financial year. For example, we are starting our 3.5 GW battery energy solution plant, which includes the cell manufacturing, pack manufacturing, and container in Gujarat this year. We have deployed majority of manpower, white collars as well as blue already on the shop floor. The manpower which is parked under construction site, largely on the business development site, is already on the board and is a cost to us. Similarly, the case is there for all other businesses which are going to go live.
Currently the existing revenue is also taking care of the businesses wherein the assets are going to sweat starting from H2 this financial year. Hence you will really start seeing the Waaree 2.0 results from H2 this year and going to a different level in FY 2028 when every asset is ready, is functional, is delivering result, and pulling and going at full throttle. Hope that clarifies.
Got it. Thank you so much. All the best.
Just to add-
Yeah.
Just to add what Abhishek is saying.
Yeah.
What essentially what we're saying is the core solar module stack, which is module manufacturing and cell, the entire CapEx will get completed in the FY 2027 financial year. The ingot wafer and part of battery will get completed in FY 2028. This 2027 and 2028 will complete large part of the CapEx. 2029 you will actually see the entire Waaree 2.0, the benefits of all operating businesses now getting seeded, starting to reflect in the financials.
Got it. Thank you so much. Yeah. Thanks. Thanks a lot.
Thank you. The next question is from the line of Prakhar Porwal from Ambit Capital. Please go ahead.
Just one question on margins. I wanted to understand, like you mentioned, 4.1 GW of module sold. I understand exports mix have gone down to 21% from last quarter at 32%. Is the margin moderation also a reason? Another reason may be that your DCR mix has gone down in India because your cell production, if I see, which is 700 MW. Is it safe to assume that that would be your DCR mix, or would you also be buying a lot of cells from outside to cater to that segment from basically other cell manufacturers in India?
I think you have hit the nail right at the center. The understanding is very clear that at the higher module portion level, the cell, DCR cell or local cell production has not gone up and hence there is some moderation because of this mix as well. Yes, there are customers for which we had even to buy out cells from the local markets just to ensure that we are delivering to our customers on time. When you do that, you are putting the money on the table to the other side where you are procuring the cells from.
Understood. Okay. Thank you, sir.
Thank you. The next question is from the line of Deep Sanghvi from Dalal & Broacha Stock Broking Private Limited. Please go ahead.
Hello, am I audible?
Yes, sir. Please proceed.
First of all, thank you for the opportunity and congratulations on a great set of numbers for the quarter as well as the year. My first question was regarding this, there's a significant gap between the EBITDA and the cash flow from operations, with the CFO like conversation declining, I think around 100%+ to about 27.5%, I guess, around that number. Could you help me understand the key factors behind this diversion?
Sure. So if you look at our cash flow statement also, you're pointing out very right that, you know, the cash flow operations percentage has significantly come down. As I mentioned in my earlier reply as well that because the inventory build-out has happened in Q4, largely because of lot of material has kept on the shores, could not be shipped out because of the logistics issue. Had that been the case, we would have been realized, we could have realized the cash into our balance sheet. That would have changed the number altogether. The inventory levels in the balance sheet also reflects the same. If you keep the levels of inventory at normalized levels, the same number will go back to the normalized level of 70% to 100% conversion of cash from current 27%.
Yeah. Okay. Just a follow-up. Could you explain the cash conversion cycle?
Sir, please rejoin the queue for follow-ups, because we have a long queue. Participants are waiting for their turn.
Thank you.
Thank you, sir. We'll take the next question from the line of Kunal Shah from DAM Capital. Please go ahead.
Yeah. Hi, sir. Just could you give some color on this entity, Waaree Semicon, and how are we thinking of this business? What would be the status of this entity in terms of, let's say, talent acquisition, government PLI, CapEx timing, and also the rationale to get into this segment? Thank you.
I think I'll, and I would really want to take this opportunity to clarify to all. The company that you saw yesterday, Waaree Semicon, is a company which is going to only manufacture to start with the components which we are consuming in the inverter manufacturing at our facility at Surat, Gujarat. Like, we are manufacturing inverters at our facility, where we are getting the complete lockdown, and we are building the inverters in our factory. We require diode for the same. This company is going to build out diodes, procure diodes globally, and get the localization of diodes within the umbrella of Waaree Power. Hence the corporate structure has been kept in a way that this company is a wholly owned subsidiary of Waaree Power Private Limited, which is the electronic manufacturing arm of Waaree Energies.
Sorry, just to clarify, but there would be like an OSAT business in this entity, right?
This is a recently incorporated entity with the tie-ups which are underway already. We believe that it is most critical for the electronic manufacturing arm to have this business or this backward integration under its own corporate structure and hence this decision.
Okay. Understood. Thank you. I'll give a follow-up in the queue.
Thank you, sir. We'll take the next question from the line of Praveen Sahay from PL Capital. Please go ahead.
Thank you for opportunity. My question is related to the order book. Sequentially, if I look at, there is INR 7,000 crore of order decline. Can you give some color? Is that some order domestically because of the challenges related to the procurement or, as you had highlighted, you had domestically also sell, procure. There is some depletion in the order book domestically.
If you look at the order book, around INR 53,000- odd crores, we have delivered more than INR 8,400 crore of revenue already. On a quarter-on-quarter basis, there's the net, there's an, there's intake of orders, the shipout of orders is much higher than the build-out. Last quarter, largely because of the disruption in the Middle East, the new orders from the overseas market have deferred from maybe a quarter to a quarter's time. Similarly, there's a lot of dispatches which are happening in the local market. In the local market, if you see, there is ALMM 2 which is coming up. Many decisions in the C&I sector largely are held up because a few people are citing that maybe there could be some extension, et cetera, decisions are getting deferred.
I think Government has clarified a day before that at which point in time they will be able to use the earlier shipped out panel under ALMM or one category to the site so that they can actually use even after that date. I think that clarification is already under progress by the Government. Because of that, many decisions were pushed out to next quarter. Hence the net offtake from the local market also was slowed down.
Thank you. Thank you for the clarification.
Thank you. The next question is from the line of Nidhi Shah from ICICI Securities. Please go ahead.
Yeah. Thank you so much for taking my question. My question mainly pertains to our supply in the U.S. We already know that because of the restrictions on Chinese cells, we cannot use that in the U.S. My question mainly remains on other components of the solar module as well, which is the solar glass, the junction box, the wafer, and any other components. In order to satisfy the U.S. FEOC guideline, do we have to also procure those from non-China sources?
Except cells, no need.
Okay. Do you think that this could come in the future?
No, we don't think so. As a matter of principle and policy, we are not using Chinese polysilicon wafers for USA. This is all from India to U.S., wherein U.S. manufacturing, we have to procure all the material from the non-FEOC countries. What that means for you, Nidhi, is that if you are going to supply components to U.S. market, let's say for manufacturing in U.S. also, be it glass, be it. Cell is already restricted. Apart from cell, glass, junction box, EVA, backsheet, everything and anything, it has to come from a non-FEOC source starting this April 26th. Which ensures that our buildout of, let's say, glass will have its market from day one as non-FEOC country. This non-FEOC clause.
If I would take one minute just to clarify further, is an enabling factor for non-Chinese players to build out capacity outside of China and Russia and create the entire value chain for shipment to U.S., either for distribution in U.S. or manufacture in India and then ship to U.S. Both the ways are open. FEOC is ensuring the non-Chinese supply chain get a great traction in U.S. starting this April 2026. That's how you also see a lot of new orders coming in U.S., from U.S. to us because of the FEOC requirements as well. This is bound to increase only.
All right. Thank you so much.
While there is no way for us to quantify the ex-China market, which is very, very large today, but it's safe to say that it's growing at a very high growth. U.S. has already become local sourcing or FEOC compliant. Domestic market in India is already becoming completely dependent on local manufacturing. Even Europe has announced its intent to become an ex-China sourcing market. Needless to say, it's difficult to quantify, but the ex-China market is a very high growth trajectory for several years now.
Thank you, sir. The next question is from the line of Akshay Gattani from UBS. Please go ahead.
hi, sir. Thank you for the opportunity. My question is related to wafers and ingots. There has been some revision both in revision to the cost of CapEx and timelines also. Like CapEx has been moved up to INR 62 billion versus INR 51 billion earlier, and timelines are now FY 2028 versus FY 2027. Why there's a change? Like some technology related change or there's any other reason to this change in both CapEx and timelines?
If you look at the plan now, we was originally putting up 6 GW worth of facility versus now setting up 10 GW of facility. Because of that and other reasons, we also shifted our locations as well from earlier mentioned locations in Odisha to now Gujarat and Nagpur. That's how some delay in overall timeline, but this revised timeline is for the 10 GW facility altogether, including the earlier 6 GW and the additional 4 GW. Hope that helps.
Got it. Thank you, sir. What will be your timelines for glass manufacturing plant?
We have mentioned in our disclosure also that we're expecting the glass production over next 24 months of time.
Got it. Thank you, sir.
Thank you. The next question is from the line of Amitoj from 360 ONE Capital. Please go ahead.
Yes. Thank you, sir, for taking my question. Two questions. First, on the copper and silicon commodity pricing. I think the silver and copper pricing has been on a upward trend since the past year. The margin impact has been very severe this quarter, 590 basis points decline. Is there any other factor? Now, of course, you mentioned that we have been also procuring DCR cells from other third parties domestically to cater to our DCR order book. That could be the main reason for our EBITDA margin decline, or is this more structural and we should see EBITDA margins at 20% levels compared to 25% seen in the previous quarters?
As we have said, so one thing you already covered that, you retain the overall cell production or the cell dispatch, to be precise, has been in line with last quarter. Overall production of modules was way higher. Hence, the percentage-wise DCR number was lower. In fact, in that as well, since we had to procure some cells and supply to our customers, that also diluted the number. This is in over and above the addition of the impact of commodity price. At the same time, I mentioned in my earlier reply as well that the change in overall sales mix from the overseas revenue to more of utility also had an impact and some dilution in the margin overall.
Okay. Thank you. Should we see this as a structural trend or the margins are expected to bounce back from Q1 onwards? Any sort of guidance?
As I-
Would be good.
As I mentioned, like H2 onwards, since our 10 GW cell is going to go live, our full throttle cell execution, 15.4 GW production and dispatch shall start. That will lead to a point wherein our entire department of cell be for the Indian market be manufactured and sourced in-house, and that will give a fillip to the overall margin profile that we have today.
Okay. Thank you. Just one last bookkeeping question.
Thanks. I'm sorry.
Okay.
I'm sorry to interrupt you, sir.
It's all right. Yeah, it's all right.
I would request you to kindly-
Yeah. Thank you. Thank you.
Thank you so much. Thank you. The next question is from the line of Raman KV from Sequent Investments. Please go ahead.
Hello sir, can you hear me?
Yes, sir. Please proceed.
I just have two questions. One is more or less like a clarification with respect to the margins. You have guided the EBITDA level to be around INR 7,000-INR 7,700 for the financial year at FY 2027. Can you, if possible, let us know whether are you sticking to the, your initial guidance of maintaining the EBITDA margin of 20%? One is that. A follow-up on that is, due to the increase in commodity prices, have you taken any price hike during this quarter, or are you planning to take any price hike in the future quarters?
I think I'll again reemphasize on our earlier calls also, and as mentioned by you, that we've been guiding overall that on a long-range basis, if you really wish to see what is there in for the next five to 10- odd years, the safest assumption there will be assume 19%-20% margin consistent for a decade long at least. Secondly, because of the effect of cells in H2 and more cell coming up in the quarter beyond that, the margin profile compared to this quarter could be different because there'll be more cells manufactured and sourced in-house. That completely uplifts the overall margin profiles. Certainly there could be quarters wherein the margin could be much higher because of the change in mix of DCR, non-DCR. Same point in time, relevant play also comes from the export book and export revenue.
In a particular quarter, if the overall overseas revenues are higher, that also gives a fillip to the overall margin profile of the quarter. Two to three KPIs to monitor will be how much DCR manufactured and shipped out in-house. Second, how much overseas revenue is there in the quarter. Thirdly, how much revenue are we also generating from our retailer. These three put together takes care of 70%-75% market. If you also look at the EPC business, which is doing phenomenally well, that also help us to work out on our overall margin profile.
Understood. Understood, sir. Sir, my last question is.
I'm sorry. I would request you to kindly rejoin the queue for follow-up.
Sure.
or new questions. Thank you, sir. We will take the next question from the line of Divya Patni from NVS Brokerage. Please go ahead.
Hello. Firstly, congratulations on the great set of numbers. Could you explain the current margins in your module and cell business and how we expect them going forward? There is concerns about the overcapacity in the module segment. How do you see the demand versus supply shaping up? Are the government policies like ALMM and PLI supporting in demand and pricing? That's it.
I think let me take up the second question first to answer. The definition of supplies in the country is changing. With ALMM 2 coming in place, the real available supply for the sector asking for DCR is not, let's say, 160 GW of ALMM 1 approved module. It is rather ALMM 2 approved solar cell capacities integrated with module capacity. Relevant capacity to note is 30 GW to date for new regulations kicking in from June 26. While the demand, like in last financial year, you have seen 50 GW-55 GW of module were consumed to install 44.6 GW worth of AC side of solar installations. Going ahead as well, there's another regulation ALMM 3 which is kicking in from 2028, which will
Which means that the cell manufacturers will have to integrate further with backward ingot and wafer manufacturing over the next two years, three years of timelines. That point in time, the, again, definition of supply will change over of integrated ingot, wafer, cell, and module capacity as a total capacity. We really don't foresee any scenario anytime next five, 10 years of time will be the supply is going to be much higher than demand. Yes, we foresee a balance between supply and demand. Anything that you export will be over and above, but the demand and supply largely equates with the regulations coming in at the right point in time, aligning with the CapEx by the serious players in the industry.
Thanks.
Okay, let me put some interpretation to this capacity numbers. There are multiple numbers out there with respect to module capacity. It could be 160 GW, it could be 200 GW. There is no way to ascertain clearly, but I'll just offer my bit. One is capacity, which is nameplate, but one has to adjust for the wafer input adjustment, so there is a 17% adjustment factor there. The other is utilization, not, the theoretical utilization could be for everybody different, but the industry operates from the smaller players are much lower utilization. The more efficient players are at 75%, 80% utilization. There is that utilization factor. The other is the efficiency factor, which is the cell efficiency.
What Abhishek is trying to say is, let's say for utilities who are looking for high efficiency modules, which have to perform for 25, 30 years, the supply is not in excess, right? There could be oversupply in the lower efficiency modules, but that's not where Waaree plays, right? Another interpretation of the EBITDA margin, and I think a lot of you have these questions around EBITDA margin. One, EBITDA margin is a function of the proportion of module and cell, and every company will have different proportions. Waaree's module volume and value is much larger being an industry leader, and that's why the module by design is higher value and margins look lower.
To give you an example, a company with no module sales and only cell will seem very high margins, but the value of sale will be much lower, right? What we emphasize from edge to the entire cell manufacturing will also be complete and operational. Waaree will have the right proportion of module to sell, and that's why margins are poised to rise. There is a transition period. Please be aware of these two factors, one with respect to industry capacity and the other is the module to sell mix. Margins are an outcome. Just one more last point on EBITDA per watt peak is the right way to look at it rather than percentage EBITDA margin, and maybe, Abhishek, you can explain a bit on that, why percentage margins actually change.
I would further take this on from where Varun just left. As in, if you look at the pricing, there are different pricing for different markets. Let's say if you're shipping out an export product, the pricing is range of let's say INR 0.25-INR 0.26 per watt peak FOB basis. A domestic utility product will be around INR 0.16-INR 0.17, so there's a price delta. In the exports, let's say if you're earning around INR 0.04-INR 0.05 per watt peak, your margin will be in range of around 80%-90%. In domestic utility, even if you are earning INR 0.025, you are still good to earn 15%-16% margin. The EBITDA per watt peak profile is completely different from same panel which is manufactured.
More important to follow is how well is your sales mix coming out. Is it only going to one particular market which takes care of the overall revenue and margin mix, or is it segregated to various pockets where you can really play out on the margin and also de-risk your customer segments? If there's a disruption in one market, you have alternates to deal with and supply with. Hope that helps.
Thank you, sir. Thank you for answering those questions. Sidra has left the queue. We'll move on to the next question, which is from the line of Parth Shah, an Individual Investor. Please go ahead.
Oh, hi. I wanted to know what are the timeline of fundraise, and what are your plans for Indosolar [WAAREEENER.NS]?
As we mentioned that we are going to come out with the objects also in the notice with the shareholder. Same point in time, we would also want to clarify on the timelines. Right now we are taking the enabling resolution to do this fundraise over next couple of months. We'll be soon coming out with the clarification on the amount, et cetera. Second question on the Indosolar, I want to clarify since this is a call for Waaree Energies Limited. I think we can take up Indosolar questions separately through the IR channel.
Okay, thank you.
Thank you.
Thank you.
The next question is from the line of Donatella Viti from VT Energy. Please go ahead.
Good morning to the management team, and thank you for taking our question. I'm talking on behalf of Mr. Volpe. We are speaking as an early investor who has believed in Waaree since 2009. First of all, congratulations to Mr. Hitesh Doshi and the entire board on closing a phenomenal financial year, achieving nearly INR 6,000 crore in EBITDA and reaching almost 26 GW of capacities and evidence of your execution power. Today, our primary reason for speaking is to give a very warm and official welcome to Mr. Jignesh Rathod in his new role as the CEO. Having known Jignesh since his days leading the production division, we know as long-term shareholders, first of all, his technical brilliance and his dedication to this company.
The transition from Waaree 1.0 to Waaree 2.0 couldn't be in better or more capable hands. We see the market reaction today, as partners since 2009, we look at the fundamentals. The vertical integration into glass and the T&D acquisition are the right strategic moves according to us. Congratulations again, Mr. Doshi and Mr. Jignesh Rathod. We remain proudly by your side for this next chapter of growth. Now the question is, as you may know, the Italian government is trying to limit the usage of PV modules made in China. In Italy, 11 GW of photovoltaic projects have been approved to be built with known Chinese photovoltaic modules and known Chinese cells. These projects could use Waaree modules made in India, which would certainly lead to an increase in Waaree's order book.
Have you considered the Italian and European markets in your development plans? Thank you.
Hi, Ms. Donatella. Good afternoon. Nice to hear you after a long time.
Thank you.
Give my regards to Mr. Volpe and all family.
He's online. He's online as well.
Okay, great. Yes, Italy is always close to Mr. Doshi's heart and entire Waaree. From where we have started, our first line is from Italy with the capacity of 30 MW way back in 2007. We love Italy. Yes, it is in our growth plan. We have built a export team dedicated to Italy with three people, and two more are joining. We are adjusting our supply chain from Southeast Asia and India for Italian market. We're very much ready to restart the Italian market, which has been stopped since 2015 onwards. We're absolutely ready for entire Europe as well.
Okay. Thank you.
Thank you.
Yes, thank you.
The next question is from the line of Pallavi from Sameeksha. Please go ahead.
Yes, sir. Thank you for taking my question. I wanted to know what would be the efficiency of the G12 wire line right now, and what is expected in second half when we are full 15 GW?
25.4% is the normal efficiency with perovskite cells.
Yeah. You mentioned about the savings, right? The 10%-12% savings, is that the primary right now this coming from the efficiency, the savings?
No, it is from G12R, we can make 615 W modules. M10R was 580 W modules. Increase of the wattage resulting into the savings, the realization of the profit.
Right. Thank you, sir.
Thank you. The next question is from the line of Karan Gupta from ACMIIL. Please go ahead.
Yeah, hi. This is Karan Gupta from Asit C Mehta Investment . My question is, the revenue mix. Just wanted to understand, what is the revenue mix geographically. The other question is related to how much we have exported to U.S. and Europe countries. Then something related to.
If I un-
DCR cell production. Why the DCR cell production is so low as compared to the peers, which is something close to double the, you know, basically the production of cell? These two things are core interrelated. First is your geographical mix in terms of revenue and the sales production.
In terms of the geographical mix in the overall overseas revenue, since we have a factory in U.S. itself, and we're also exporting from India as well. Our overall revenue from overseas, more than 90% shall be from U.S. markets alone. The remaining is from markets when we have started to explore and also started to ship out materials. However, over next few months, we see a great amount of opportunity coming in from European markets and African markets as well. In fact, in the Middle East market also, we have started to receive the inquiries for build out of large farms over there for renewables. That means not just U.S., there are three markets which have U.S. equivalent potential to consume overall renewables, be it Africa together, European markets or Middle East.
We really foresee a very diversified overseas market as well going ahead. Answer to your question number two around lower production on DCR, as we have explained in the earlier questions as well, that since we have been transitioning now from M10 to G12R size of cells, hence there have been some lag in the production of cell. This will have benefit starting from a quarter down the line, wherein we will see 10%-12% of higher production from the same lines, resulting into higher re-realizations for the long term.
Okay. Okay. Utility, retail, EPC, all are domestic.
Sorry, couldn't get that question.
Utility, retail, EPC, all are domestic, revenue mix.
Yes. Yes, yes. In the, in the revenue mix, yes, you're right.
Okay. Okay. Thanks. Thank you.
Thank you. Thank you, sir. We'll take the next question from the line of Abhishek Nigam from Motilal Oswal. Please go ahead.
Yeah. Hi. Thank you so much for the opportunity again. Just, I know this question was, I think, you know, it came up a little earlier in the call. Just on the cash conversion cycle and the working capital days, if I look at numbers in the last year, FY 2025, overall working capital cycle was around 45- odd days, which is now closer to 90- odd. Is this what we should sort of, you know, build and go ahead? Do you think that, you know, it's a sign that there is more sort of capacity in the industry and so the working capital is, you know, getting a little favorable in terms of the customers or how should we think about it now?
There are two areas to look at to understand this better. First is the effect of inventory, higher inventory, which I also explained in my earlier reply that in the March ending quarter, the overall inventory has gone through the roof because of lower shipments for the overseas market. Number two, the advance from customers has remained steady and strong, given the levels are also similar. Because the overall run rate of production has almost doubled in a year's time, while the absolute number of advances were same, hence the effect on the working capital cycle. Despite the high advance from customer even today, because of higher sales numbers, the dilution in terms of working capital days. I hope these two put together explains the effect of cash conversion in the cash flow.
Just one clarification on that. The percentage of advance, let's just say assume you were asking for, say, a 5% advance earlier. Is it still 5% or has it, say, gone down to, say, 2.5% or something?
In fact, not 5%. We have seen wherein we have been getting advances to the tune of 10%-20% also in few cases, and other few cases 5% also.
Sure.
The trend remains the same. However, because of geopolitical reasons, the tendency to give higher upfront advances for long-term contracts in the same set of customers has moved towards more advance at the time when you start the production or start the raw material procurement. You won't get that much of higher advance on the day one of signing off, but certainly we continue to receive advances before we start the dispatch or the production also. Our overall cash remains in the same environment of no credit policy. Yes, this will have an effect in the number of days of advance from customers.
Okay. Okay. I think that clarifies. Thank you very much.
Abhishek, just to add to what you're right on asking about the working capital, but we shouldn't take our eyes off the main true north is ROC. If you see, despite the rise in working capital, our ROC remains truly top quartile.
Thank you, sir. The next question is from the line of Mitesh Mehta from Long Term Investment Group. Please go ahead.
Good evening. Congratulations for great set of numbers. Most of my questions have been taken up. I am keen to know how company is planning for non-U.S. and non-Indian market.
That's what we said. Europe is our next big destination, Africa and Middle East.
Okay.
Covering up with everything.
Okay. We can expect, say, some, 15%, 20% revenue three years down the line from, non-U.S. and non-Indian market?
Yeah. 3% down the line is yes, but it is both loading.
Three years down the line. Yeah.
Thank you, sir. The next question is from the line of Aritra Banerjee from Nomura. Please go ahead.
Yeah, thank you for taking up my question again. Just wanted to understand, you know, regarding the BESS business. What are the kind of unit economics and margins that we can expect? What will the contribution from FY 2029 of that BESS business to Waaree's total revenue and EBITDA?
For someone to understand BESS business, I think, I'll fall short of time if I start trying explaining all the economics. What I can do for you is make it a little easier. On the BESS business, the basic conversion plus the raw material that we will require for manufacturing of cell, plus the BESS cost. Our ROCs and ROE are falling in the current range of delivered ROCs and ROEs over the historical numbers. To explain it further, you expect the business to generate around 18%-20% margins without any support from the policy perspective or any mode of regulatory inculcated.
If at all there are, there are policies which are more conducive for global manufacturing, which we are certainly hopeful as we keep hearing from the government as well, that they are going to support Make in India for the entire value chain. I think the numbers could change, but the basic business economics considering the ample demand coming from U.S. market and now from Middle East market also, wherein customers are asking for alternate supply solution for energy storage, I think this is the time to do the manufacturing deployment so that we have enough of capacity available.
Mm-hmm. Yes, sir. Understood. Any sort of, you know, revenue color for FY 2029 or any timeline that you have in mind for revenue contribution from BESS?
I think it is too early to comment on any guidance around the revenue in FY 2029 for BESS. If you wish to calculate anything, you can take up the total capacity that we are setting up, 20 GWh . You can also take an assumption from market around the average price per megawatt hour for the BESS in India and U.S. The average would come around $110-$120 odd. I think you'll get some sense of the numbers that can come out from this business. Right now, too early to comment.
Understood, sir. Thank you. Thank you.
I think we'll all agree that BESS is one of the biggest enablers of the entire energy transition. It is the most critical component for even solar to accelerate during the non-solar hour, because whatever surplus energy that gets created during solar hours can now be stored and that gives new wings to solar manufacturing. With respect to revenues and all, obviously we can't put a number, but the industry number is that India would need anywhere close to 60 GWh-80 GWh of BESS annually. The cumulative number that is put out by NITI Aayog and MNRE is that India needs to get to 300 GWh of BESS over the next five to seven years. Waaree's 20 GWh is just a beginning.
I think the runway of growth and capacity is multi-decadal in this segment. Let's be patient about how BESS segment plays out. That has the potential to create a new Waaree in itself. It would take a few years to get there.
Thank you, sir. The next question is from the line of Sushil Choksey from Indus Equity. Please go ahead.
Sir, congratulations for very stable numbers. What do you forecast as your cell production in second half for the year and next year with established capacity which you have highlighted?
If you wish to get a sense of cell, difficult to give exact number, but I can give you, sir, a range. Like on the existing cell capacity of 5.4 GW, you can expect in the H2, because there are six months, I'll cut down the capacity from 5.4 GW- 2.7 GW effectively. You expect at least 95% of production in second half itself. For the new build-out, 10 GW capacity in H2, since the ramp-up will happen over three to six months of time, we can expect some bit of number from that capacity as well.
Can you just give an indicative number for, let's assume for FY 2028, forget 2027. Secondly, what is the total production increase you are estimating from existing capacity line which you're converting?
All right. For FY 2028, you know, we have entire 15.4 GW cell capacity available for complete, 12 months. The safe assumption could be to assume 85%- 88%, 85% utilization on the full year scale for FY 2028 on the cell capacity.
How much will you use for DCR and schemes like Kusum and Surya out of that?
Sir, our cell that we are going to manufacture largely is right now planned for the domestic markets only. That means not majority, in fact almost 90%-95% or maybe 90% shall be used for the local DCR market only.
Okay.
Unless there are, like we keep hearing now from Italy market, from French markets that the requirement of non-Chinese supply chains are coming a big way. If at all that also opens up, we may use something in those markets, but too early to comment.
Entire Europe market is open for replacement, which has implemented between 2005-2010. Is Europe market likely to fetch you a better price or domestic DCR? Second thing, the TOPCon price and mono PERC price, what is the price differential as on today?
For us to see a comparison between European market and DCR market, right now the pricing in DCR market are fairly priced. In the European market, the orders are even coming for the full stack solution, not just the panels. Good news for us, a player like us wherein we not just supply the panel, we give the entire EPC solution, transformers, T&D services. The number is very exciting. Let's say if we are constructing a solar farm in India with T&D, if the cost is coming around INR 3.5-INR 4 crores a MW, same set of plant in Europe would cost around 20%-30% higher.
For us, the realizable value for same set of megawatts on an overall system basis is very high when we go outside of India, be it U.S. markets or be it European markets. That's why Waaree 2.0 is very essential for us if we really wish to take out larger pie of the cake which is there for next decade. Hence all these segments which are going to set their assets starting H2 this year and big way in FY 2028, we will really see numbers moving basis those capacities and setting of those capacities.
Can I assume that in FY 2028, first half will be lower number at 50%-60% of the new capacity and second half would be at 80%-90%? On a blended basis it would be at 80%?
Sir, I think difficult to comment exact percentage. You can reasonably expect that 15 GW cell capacity will be used reasonably the next financial FY 2028. 28 GW of module capacity, global capacity, including 4.2 GW in U.S. and another 24 GW in Indian markets will be used at full throttle. Some bit of this capacity which is coming this year, 3.5 GW will be used for entire next financial year. 20,000 MVA worth of transformer capacity will be consumed throughout next financial year. Electrolyzer capacity of 1 GW, yes, available for entire year. 4 GW worth of inverter capacity, yes, available for entire year.
In fact, on top of it, the EPC company with an acquisition of Transmission and Distribution arm, APSL, will be also available to capture, good amount of share in the market of EPC in India and overseas as well.
If we can-
Answer to you will be next year, FY 2028, Waaree 2.0 will start showing its results, the compounding of assets that we are trying to create over years and the impact of large scale deep integration and penetration all working together to build a new Waaree.
The current year which went by was.
Sorry to interrupt, Mr. Choksey. May we request you to return to the question queue. There are participants waiting for their turn. Thank you. The next question is on the line of Abhishek Kansara from Axia Asset Management Private Limited . Please go ahead.
Hi. Good afternoon. Thank you for taking my question. My question was, how much will be the module production from our U.S. arm, and how much will be the IRA rebate that we have received this quarter? Whether this IRA rebate is included in the revenue number or our other income number.
In the U.S. markets, the overall revenue in last financial year was 1 GW +, wherein around 85%-90% was manufactured locally from our own factory. We have been getting IRA for $0.07 per watt peak against per watt peak of panels sold. There are some costs to incur when you convert that into cash, so we factor around 87%-88% only of the eligible IRA. Last financial year, roughly around $40 million was our community benefit from IRA. However, this year when we start another 2.6 GW facility in the U.S. and the earlier line also runs at full throttle, the overall effect in IRA will be multifold, naturally.
Thank you, sir.
Thank you.
Thank you.
The next question is on the line of Rahul Rohit from Ambit Wealth. Please go ahead.
Hi. Thanks for the opportunity. It would be really helpful if you could throw some light on ALMM 2. There's a lot of ambiguity in terms of when will the ALMM 2 demand actually kick in in India. You know, if you could give some on-ground reality on this, it would be really good.
Very difficult to answer with government also not able to answer so far. Speculations are going on, I think within a week we will have a clarity from government.
I think the intent is absolutely clear that the government wants to transition to as much local manufacturing of cell, eventually ingot, wafer, power electronics, everything. The question is about three months here and there and the timeline. If you see ALMM 1, now is successfully and fully implemented, adopted by the industry.
Right.
The cell manufacturing related ALMM 2 is just about, you know, almost formalization. 1st of June, it comes into effect.
Got it.
Thank you.
Got it.
The next question is on the line of Sweta Jain from Anand Rathi Shares and Stock Brokers Limited. Please go ahead.
Thank you for taking the question again. Just wanted to understand, in our erstwhile comment you mentioned that the higher commodity prices have now been started reflecting in our realizations as well.
Wanted to know the current order book obviously is at the last quarter's numbers or reflecting the price hike that we've taken to factor in these commodity prices?
Thanks for asking this question, Sweta. I think I've tried to clarify in my earlier answer as well that the effect I started to see on the ground in terms of pricing conversion. There were not many intake of orders because of decisions on policy and clarity. In the overseas market, because of the global tension, the intake was comparatively lower. Yes, we can rightly assume that now all the existing pipeline, all the current order which are going to intake are going to factor in the price naturally.
That would be reflected.
Sorry to interrupt, Sweta. May we request that you return to the question queue? There are participants waiting for their turn.
Okay.
Sweta, just to acknowledge, the report that you released, had very good industry insights, especially clarifying on the overcapacity issue, nuancing this, high efficiency and, you know, areas. I think that was very well covered in your industry report.
Thank you, sir. The next question is on the line of Rajesh Kapadia from Raj Investments. Please go ahead.
Hello.
Yes, Rajesh, please proceed.
Am I audible?
Yes, yes.
Thank you for taking my question, and congratulations on good set of numbers. Sir, this is question regarding our subsidiary, Indosolar. Will you answer that question?
No. We would request that we can get that question written to the IR team of Indosolar. We shall get back to you over there.
Okay.
Thank you.
Okay. Thank you.
Thank you. The next question is on the line of Harshit Jain from POJC. Please go ahead.
Hello.
Yes, sir.
Sir, am I audible?
Yes.
Yes. Sir, that currently with the large CapEx announcement you have done across the new verticals, are these business expected to deliver high ROC and ROE with the current level, or should we expect some dilution at the company level as they scale up?
In fact, in the earlier calls in our presentations, we have tried to communicate this, that the decision-making for allocating capital by the board is largely driven by the division of return on the capital, which is a very attention metric for us. Historically, we have seen the projects of ROCE and ROE to the tune of 20%-25% have been approved. Same is the case with current projects also. You can reasonably expect to get delivery of similar set of return on capital from the investments that we are making. Hope that is.
Sir, my second question is that, within the next three-.
Sorry to interrupt, Mr. Jain. May we request that you return to the question queue? There are participants waiting for their turn.
Sure, ma'am. Sure.
Thank you, sir. The next question is on the line of Sarang Joglekar from Vimana Capital. Please go ahead.
Hi. Thanks for the opportunity. I just want to understand the demand supply scenario in the non-DCR market. I mean, you addressed this before, but just a clarification because now that ALMM is also there, some speculations on that getting deferred. Do you see any pressure in this non-DCR market now?
As covered in the earlier question that, yes, because of some speculations, some decisions, especially on the C&I and mid-markets, are being deferred, basing the assumption that there could be some change over in the timelines. I think we should wait on and see, wait for the developments, regulatory developments.
Understood. Do you see any, you know, supply pressure because of that? Any pricing, competition?
I think, we're not clear about your question, but the mode premise is that the entire market will move to DCR as soon as ALMM 2 is instituted. Right. With respect to supply, cell supply, do you mean about that? That there's a shortage of some modules?
No, I mean, that if that is ALMM is deferred and there's already a lot of module supply, do you see a scenario where the smaller module players would be, you know, much more aggressive in pricing, to, you know, take advantage of that deferred period?
You may expect some cases wherein the players who are in the race or mode of survival may even get down to any point of price. That can't be ignored. Fact here is the buyers, the C&I, be the utilities, anyone, are looking for suppliers who are able to demonstrate warranty servicing over next 30 years. Someone struggling for survival, supplying at the cheapest price, majority of C&Is are always take this precaution.
In fact, the banking institution also now has started to acknowledge the fact that they're funding those projects wherein the visibility of the OEM to continue catering the warranties for next 25 and 30 years is reasonably well. Going ahead, the maturity of financial markets, the banking fraternity acknowledging more for large scale quality suppliers who have ground performance track record, bare minimum certifications, all in a line of what has happened in the Western market is something that we are waiting to watch for. I think this is going to reward those players who are continuing to perform, supply, and are also now able to do backward integration in line with the government's expectations of ALMM 2, 3, and maybe many more to come.
Got it, sir. Thank you.
Thank you. The next question is on the line of Akash Saraswat, an Individual Investor. Please go ahead.
Thank you for the opportunity. Sir, actually, I want to know your view regarding green hydrogen. Sir, just want to know that whether when green hydrogen can become commercially viable on a large scale, and what scope do you see for the green hydrogen and its derivatives, such as green ammonia and green methanol in coming years?
Thank you for asking this very relevant question in current context, wherein the entire Middle East market and the markets dependent for gas supplies on this particular chunk are waiting to see an alternate form.
Yes, sir. Thank you.
The Indian market has started to see traction towards green hydrogen and ammonia and other derivatives out of it already. We are in discussion with many clients and customers who are asking us to commit supply of long-term contracts for hydrogen for their manufacturing capacities, those who are in the chemical sector, those who are in the steel plant manufacturing, and many more players. Similarly, there are discussions wherein the blending of hydrogen could be allowed in the gas system as well. Once the decisions by the regulators come in for blending of hydrogen and other localization of green ammonia in the urea, et cetera, I think there will be a gold rush towards getting hydrogen and green ammonia in-housed in the country.
Sir, one more question.
Sorry to interrupt, Mr. Saraswat. That was the last question we could take.
Sir, last question.
Thank you. Ladies, and gentlemen, as there are no further questions from the participants, I now hand the conference over to Mr. Jignesh Rathod for his closing comments.
One more point that Waaree has pivoted to multiple areas of growth consistently over the years. It was primarily a domestic company, four to five years back or before. Then came the exports opportunity. Today we are talking about retail being such a large part of revenue and being a new additional growth lever. We're talking about global manufacturing out of U.S. being additional growth lever. We're talking about new business segments emerging. I think, given the challenges, which could be geopolitical, which could be supply chain, which could be domestic regulations, Waaree has always found its way through scaling and finding new areas of growth. I think what Abhishek and Jignesh bhai alluded right in the beginning, no single channel, no single market, no single customer or business segment will dominate, and over time it will de-risk both horizontally and vertically.
Jignesh bhai, yeah.
Thank you. Thank you all, ladies, and gentlemen, for your time, your patient hearing, and your continuous trust in Waaree. It has been a pleasure to share with you yet another robust performance, and we remain confident in the growth opportunities that lies ahead. We're also excited to invite you to our Investor Day, an exclusive event where our leadership team will showcase our strategy in action across multiple business segments. The event is intended to provide deeper insight into our strategic priorities and the next phase of our growth journey. You can get in touch with our investor relations team for registration process. Thank you once again. We look forward to speaking with you again next quarter. Thank you.
Thank you, members of the management team. Ladies, and gentlemen, on behalf of Waaree Energies Limited, that concludes this conference call. We thank you for joining us, and you may now disconnect your lines. Thank you.