India’s solar energy sector is experiencing significant growth, showcasing the nation’s commitment to renewable energy goals. India has set an ambitious target of achieving 500 GW of renewable energy capacity by 2030, with solar power playing a crucial role in this endeavour. With the sector’s continuous growth, investors can find exciting opportunities in solar energy stocks in India to take advantage of the flourishing green energy boom.
However, having a deep understanding of the dynamics of the solar power sector is crucial in order to take full advantage of this green revolution. In this article, we will delve into the various factors that should be taken into account when considering investments in solar energy companies. We will also discuss the potential benefits and risks associated with such investments, as well as provide guidance on how to go about investing. Additionally, we will present an up-to-date list of the top solar stocks in India for the year 2024.
Best Solar Energy Stocks in India 2024: Overview
Solar energy companies specialise in utilising the sun’s power to produce electricity. These companies are involved in the manufacturing of solar panels, providing solar power solutions, and offering installation and maintenance services for solar power systems. India is witnessing the emergence of numerous companies that are at the forefront of the solar sector, actively supporting the nation’s renewable energy objectives.
1.Adani Green Energy Ltd
AGEL is an Indian company that focuses on renewable energy and is based in Ahmedabad, India. The Adani Group holds the majority ownership while TotalEnergies has a minority stake in the company. The company runs the Kamuthi Solar Power Project, which is considered one of the largest solar photovoltaic plants globally.
Ranked 27th as of May 27th, 2024, the stock boasts a market cap of Rs. 3,05,187 cr. The stock exhibits significantly higher volatility compared to Nifty. The company under solar industries India has experienced impressive growth, with a yearly return rate of 41.52% over the past 5 years.
2.K.P. Energy Ltd
Established in 2010, K.P. Energy Ltd has emerged as a prominent player in the renewable energy sector in India, with a primary emphasis on wind power projects. The company has been actively involved in supporting India’s sustainable energy goals through the development and operation of multiple wind energy projects. In February 2024, the board of K.P. Energy approved the allotment of 4.44 cr. bonus shares in a 2:1 ratio, resulting in an increase of the paid-up equity share capital to Rs. 33.35 cr. The company also landed a contract for a 9 MW wind power project in Gujarat, resulting in a substantial increase in their stock price.
On 5th June 2024, K.P. Energy Ltd’s market capitalisation stood at Rs. 2,784.31 cr. with a stock price of Rs. 407.9. The company has consistently achieved a 5-year average return on investment (ROI) of 17.23%, and their impressive 1-year return stands at 489.88%. The 5-year average net profit margin stands at 7.77%, while the return on equity (ROE) is an impressive 37.24%.
3.Orient Green Power Company Ltd
As an expert in the field of renewable energy, Orient Green Power Company Ltd is an Indian company that was established in 2006 with a primary focus on generating renewable energy through wind power plants. They possess a combined capacity of 402.3 megawatts (MW) spread across various regions in India, including Tamil Nadu, Andhra Pradesh, Gujarat, and Karnataka.
In addition, they possess a wind farm with a capacity of 10.5 MW in Croatia. This small cap company has a market capitalisation of Rs. 2,064 cr. and is 5.34x more volatile than Nifty. The stock’s compound annual growth rate over the past five years is an impressive 41.35%. In addition, the debt-to-equity ratio has been quite high at 269.12% over the past 5 years.
4.WAA Solar Ltd
Established in 2009, WAA Solar Ltd focuses on the development and operation of solar power projects. The company specialises in both utility-scale and rooftop solar installations. WAA Solar has recently formed a promising collaboration with a prominent real estate developer to implement a rooftop solar project. The company is actively considering options to grow its solar operations in Southeast Asia.
On 5th June 2024, WAA Solar Ltd’s market capitalisation stood at Rs. 264.87 cr. with a stock price of Rs. 178.25. The 5-year average return on investment is 7.03%, while the 1-year return is an impressive 253.74%. The 5-year average net profit margin stands at 16.87%, while the ROE is recorded at 5.04%.
5.KPI Green Energy Ltd
KPI Green Energy Ltd, established in 2008, specialises in the development and operation of solar power projects. The company runs a number of solar plants under its ‘Solarism’ brand. KPI Green Energy plans to launch a 200 MW solar power project in Gujarat. The company is making significant investments in cutting-edge solar technology to improve efficiency and lower expenses.
On 5th June 2024, KPI Green Energy Ltd’s market capitalisation stood at Rs. 11,231.25 cr. with a stock price of Rs. 1,755.45. The 5-year average return on investment stands at 11.18%, while the 1-year return has reached an impressive 412.29%. The 5-year average net profit margin stands at 16.65%, while the ROE is an impressive 53.27%.
6.Borosil Renewables
Borosil Renewables has achieved a prominent position on the list of top solar energy stocks. It is the sole manufacturer in India of solar glass, a crucial component of solar panels. With a solar glass manufacturing capacity of 1350 TPD, this company is a major player in the solar industry.
The company has a strong global presence, with a significant number of international clients located in Western Europe and Turkey. Additionally, exports play a significant role in contributing to the company’s revenue, accounting for 25% of the total. In the fiscal year 2023, the company’s total income amounted to ₹913.77 crores. In the first half of fiscal year 2024, the company generated a total income of ₹768.77 crores and achieved an EBITDA margin of 9.5%.
7.Suzlon Energy
We are all familiar with the solar energy company Suzlon. It is a global frontrunner in wind energy and has recently ventured into the solar energy industry. Our company focuses on offering comprehensive solutions for solar power projects. We support clients in acquiring solar power plant projects and guide them in establishing a profitable operation.
In the FY 2023, the company generated a revenue of ₹5,990.16 crores, showing a growth of 6.8% compared to the previous fiscal’s revenue of ₹5,603.97 crores. In H1FY24, the company’s revenues stood at ₹2,790.37 crores, showing a slight decrease of 1.2% compared to the previous fiscal year. In FY23, the EBITDA margins were recorded at 14.1%, while in H1FY24, they increased to 15.6%.
8.Urja Global
Urja Global is a solar energy stock that stands out as a top player in the field of renewable energy development. They offer comprehensive solutions for solar power projects. We specialise in the design, consultancy, integration, supply, installations, commissioning, and maintenance of off-on-grid solar plants.
In the fiscal year 2023, the company’s total revenue amounted to ₹41.41 crores, which was a decrease of 44.4% compared to ₹74.53 crores in the previous fiscal year. In H1FY24, the total income is reported at ₹21.32 crores, showing a 4% increase from ₹20.50 crores.
9.Ujaas Energy Ltd
Ujaas Energy Limited, based in India, is a leading player in the solar power sector. They offer comprehensive solutions for solar energy, including the development, operation, ownership, and maintenance of solar power plants under the UJAAS brand. The company is involved in three main areas: operating solar power plants, manufacturing and selling solar power plants, and working with electric vehicles (EV). The company offers a range of products including Ujaas Park, Ujaas My Site, and Ujaas Home, which are designed to meet the diverse needs of customers, from commercial entities to residential homes. They provide comprehensive solutions for solar power production and customised installations.
The market capitalization of Ujaas Energy Ltd stands at Rs. 461.22 crore. The stock’s monthly return is an impressive 39.94%. The one-year return is an impressive 2267.57%. The stock is currently trading very close to its 52-week high.
10.Gita Renewable Energy Ltd
Gita Renewable Energy Ltd is an India-based company that specialises in power generation through renewable energy sources. The company’s main focus is on the development, ownership, and operation of power plants that harness renewable energy sources. Its portfolio consists of wind, solar, and biomass energy projects that focus on delivering sustainable and environmentally friendly power solutions. Gita Renewable Energy Ltd focuses solely on the generation of renewable energy. The company is dedicated to making a positive impact on carbon emissions and supporting India’s energy needs in an environmentally friendly way.
Gita Renewable Energy Ltd has a market capitalization of Rs. 70.20 crore. The stock’s monthly return is an impressive 20.13%. The one-year return stands at an impressive 115.01%. The stock is currently trading at a significant distance from its 52-week high.
Why Invest in Solar Energy Stocks?
Investing in solar energy stocks can be a smart move for those looking to capitalise on the expanding market for solar energy solutions and potentially earn attractive long-term returns. Investors can diversify their portfolios and contribute to the cause of sustainable energy and reducing greenhouse gas emissions.
Factors to Consider Before Investing in Solar Energy Stocks in India
Prior to purchasing the leading solar energy stocks in India, it is essential to take into account certain factors in order to make a knowledgeable choice. These factors include:
Financial Performance : It is important to assess the financial performance of the solar energy company, including factors such as revenue margins, profitability, cash flow, and more. Seek out companies with robust financial metrics.
Global Economic Factors : Several global economic factors have the potential to impact the shares of solar companies. For example, supply chain disruption can have a significant impact on the availability of raw materials and other components used in solar industries.
Ccompetitive Advantage : Investing in solar stocks in India can be highly lucrative due to the significant cost advantages of solar power. This has led to a remarkable increase in the demand for solar equipment. Competition is a crucial factor to consider, so it’s important to identify solar stocks with long-lasting competitive advantages.
Conclusion
Investing in solar energy stocks in India presents a promising opportunity, considering the industry’s exponential expansion. Through a comprehensive analysis of financial metrics and a careful assessment of each company’s market position and potential, investors can make informed decisions that align with their investment objectives. Conducting extensive research is crucial prior to making any investment decision.
Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.
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