JPMorgan has revised its target price on Premier Energies Ltd., raising it from Rs 940 to Rs 1,013 for fiscal 2026, after its fourth-quarter net profit rose and margin expanded.
The company reported a 9% rise in net profit to Rs 277.8 crore, which was ahead of JPMorgan's estimate of Rs 218.4 crore, along with "a continued expansion of Ebitda margins (up from 30% in 3Q to 32.6% in 40)," the brokerage stated in its report.
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Overall, JPMorgan maintained its neutral stance on the solar module manufacturer after the company reported revenue below the consensus estimates. Revenue declined 5% to Rs 1,621 crore, compared to Rs 1,713 crore in the previous quarter.
The research firm attributed a fall in revenues to "softer prices". Premier forecasts strong Indian cell demand due to factors like demand in corporate roof top solar installations, and government schemes like PM-Surya Ghar and PM-Kusum, that encourage installation of solar panels in houses, and so on, the brokerage said.
However, the brokerage projects lower than expected demand. "Even if all of these come through on time, total Indian DCR/ALMM solar cell demand would be about 60 GW a year. We think demand will likely be noticeably lower. This is c.25 GW of current solar cell capacity installed, with more likely to start soon (India is projected to have 60 GW of solar cell lines by FY28). This could exert pressure on local prices and margins," it stated.
Premier Energies won orders worth Rs 3,100 crore, up 40% and announced capacity expansion of cell and module plants by 0.8 GW and 1.6 GW, respectively. The company will spend a total capex of Rs 475 crore for this expansion, which will be met via internal accruals.
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