Summary
Websol Energy System Limited - Q3 FY26 Earnings Call Summary Friday, January 30, 2026, 4:00 PM IST
Event Participants
Executives 4 Amrit Daga (CFO), Sanjana Khaitan (Executive Director), Sohan Lal Agarwal (MD), Vasanthi Sreeram (CTO)
Analysts 9 Aman Soni (Nvest Analytics), Amit Mishra (Individual Investor), Ankush Agrawal (Surge Capital), Apoorv Singh (Panchratna Investors), Ashwani Agarwal (CASA Capital), Darshan Garg (Tiger Asset), Deepak Rao (Qber Asset Advisors), Rahul Hemani (Hemani Financial), Rudransh Kalra (MB Investment), Shashank Jha (SB Capital), Somnath Saha (B&K Securities), Yash Chandalia (British Asian Trust)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue from Operations | ₹261 crores | +77.2% YoY; Growth driven by commissioning of Cell Line-2 and higher utilization. |
| EBITDA | ₹106 crores | +40.8% margin; High margins attributed to unique cell-heavy product mix (1.2 GW cells vs 550 MW modules). |
| Profit After Tax (PAT) | ₹65 crores | 24.8% margin; Impacted by softening industry prices and shift toward blended module sales. |
| Order Book | ₹1,150 crores | Includes 57% modules and 43% cells; represents firm purchase orders with 1-year visibility. |
| Net Debt | ₹89 crores | Improved Debt/EBITDA to 0.47x from 0.60x in FY25; CRISIL assigned BBB+ stable rating. |
| Capacity Utilization | 97% (Line-1) | Phase-1 cell line at peak; Line-2 (commissioned Sept '25) ramped to 54% in Q3 and ~90% by Jan '26. |
| Realization (Cell) | ~$0.14 / watt | Management noted recent price firming after a temporary dip in Q3 FY26. |
| Realization (Module) | ~$0.23 / watt | Blended realizations affected by rising silver costs and China export rebate changes. |
Geographic & Segment Commentary
- Domestic DCR Market: Entire production is focused on Domestic Content Requirement (DCR) compliant cells and modules. Management noted significant demand from government schemes like PM KUSUM and PM Surya Ghar (Rooftop), where a supply-demand gap persists for DCR products.
- Export Market: Currently zero exposure due to high US tariffs and domestic demand lucrativeness. Management is monitoring the Europe-India FTA for future replacement market opportunities (plants installed 2004-2010), but prioritizes the domestic market for the short term.
- Andhra Pradesh Project: Allotment for a new 4 GW integrated facility is complete. Phase-3 (2 GW Topcon) is estimated at ₹1,600-1,700 crores, with financial closure expected by March-April 2026.
Company-Specific & Strategic Commentary
- Backward Integration: Entered MOU with Linton for local manufacturing of PV ingots and wafers. Focus is on a 2.5 GW initial capacity to meet the June 2028 ALMM mandate for wafers.
- Technology Migration: Transitioning from Mono PERC to Topcon technology for the Andhra Pradesh expansion. Current West Bengal lines (1.2 GW) are being evaluated for Topcon upgrades as the industry shifts.
- Cost Optimization: Reduced silver consumption by 25% through process optimization with a further 10% reduction target. The technical team is evaluating silver alternatives to mitigate commodity price volatility.
- Succession Planning: MD S.L. Agarwal confirmed a structured transition, with ED Sanjana Khaitan taking higher leadership roles supported by CTO Vasanthi Sreeram and a professional management layer.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Project Timelines | Financial Closure March-April 2026 | Targeting Phase-3 (2 GW) commencement in Andhra Pradesh; land and incentives already secured. |
| Margins | Moderate “Sustainable” Levels | Expecting 3-4% compression over 2-3 years as industry matures and module mix increases. |
| Debt Repayment | Systematic De-pledging | Aiming to release promoter share pledges in the next few months as the IREDA loan (₹100cr net) is settled. |
Risks & Constraints
| Risk | Context |
|---|---|
| Raw Material Volatility | Heavy reliance on silver and Chinese wafers; silver prices have risen significantly, though mitigated by 25% consumption reduction. |
| Inventory Risk | Inventory rose to ₹93 crores in Q3 due to “temporary liquidity constraints” at the customer end, causing deferred offtakes. |
| Concentration Risk | 100% of wafers are sourced from China; no current domestic manufacturing capacity exists to offset this dependency until the Linton project matures. |
Q&A Highlights
Operational Performance & Margins
- Question: Why are revenue figures lower than capacity potential this quarter? (Ankush Agrawal)
- Answer: Higher utilization didn’t fully translate to revenue due to deferred offtakes from customers facing liquidity constraints; however, orders are not cancelled (Sanjana Khaitan).
- Question: Are current 40%+ margins sustainable? (Aman Soni/Shashank Jha)
- Answer: Some moderation (3-4%) is likely as module sales increase, but high margins are protected by the tech-intensive nature of cell manufacturing and the supply gap in DCR cells (Sanjana Khaitan/Amrit Daga).
Capital Expenditure & Debt
- Question: How will the ₹1,700 crore Phase-3 be funded? (Amit Mishra)
- Answer: Planned 70:30 debt-equity mix. ₹1,100-1,200 crore debt via banks/FIs; ₹500 crore equity from internal accruals and warrant conversion. No QIP planned (Sanjana Khaitan).
- Question: Will the new loan require more promoter share pledges? (Aman Soni)
- Answer: We are working to release current pledges; the expansion is via a wholly-owned subsidiary (Websol Renewables) where we hope to avoid share pledges (Sanjana Khaitan).
Technology & Supply Chain
- Question: Does our cell efficiency beat the industry? (Sushil C. Choksey)
- Answer: We have achieved 23.4% - 23.6% efficiency on Line-2 within months of commissioning, matching Chinese players due to 30 years of experience and a specialized R&D team (Vasanthi Sreeram).
- Question: What is the status of the wafer/ingot partnership? (Deepak Rao)
- Answer: Currently in technical evaluation with Linton; targeting 2.5 GW capacity to align with the 2028 ALMM wafer mandate (Sanjana Khaitan).
Key Takeaway
Websol Energy delivered a strong Q3 FY26 with a 77.2% YoY revenue jump to ₹261 crores, supported by the rapid ramp-up of its second 600 MW cell line. While EBITDA margins remained high at 40.8%, management signaled a transition toward a more sustainable, slightly lower margin profile as the product mix shifts from pure cells to blended modules. Structurally, the company is pivoting toward massive scale with a 4 GW integrated expansion in Andhra Pradesh and a 2.5 GW backward integration into wafers to secure its supply chain against Chinese import volatility. Despite short-term inventory build-up from customer-side liquidity issues, the ₹1,150 crore order book and high DCR demand provide solid visibility. The company remains focused on achieving financial closure for Phase-3 by April 2026 while utilizing internal accruals to minimize equity dilution. Websol is positioned to benefit from the tightening ALMM mandates, provided it successfully executes the technological shift to Topcon and manages its upcoming debt-heavy expansion.
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