ACMESOLAR - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 2.7

Here’s a detailed breakdown of Acme Solar Holdings Ltd (ACMESOLAR)

🧾 Core Financials

Profitability & Growth

PAT improved slightly to ₹0.81 Cr from a loss of ₹9.99 Cr, but still negligible.

EPS of ₹0.74 is extremely low, indicating weak earnings power.

ROE: 5.18% and ROCE: 7.63% — below average, reflecting poor capital efficiency.

Debt & Liquidity

Debt-to-equity: 0.50 — moderate leverage, manageable but not ideal for a low-margin business.

Dividend yield of 0.07% is symbolic, not meaningful for income investors.

📊 Valuation Indicators

Metric Value Industry Avg Remarks

P/E Ratio 487 31.2 Extremely overvalued

P/B Ratio ~4.03 ~3.5 Slight premium to book value

PEG Ratio 8.82 ~1 Price far exceeds growth

Intrinsic Value ~₹180–₹220 — Significantly overvalued

The valuation is disconnected from fundamentals, driven more by sentiment and sector hype than earnings.

🏢 Business Model & Competitive Edge

Core Operations: Solar power generation and renewable energy infrastructure.

Strengths

Positioned in a high-growth sector with strong government tailwinds.

FII interest rising (+1.02%) suggests institutional optimism.

Risks

Poor profitability and volatile earnings.

High valuation with minimal earnings support.

DII outflows (-0.48%) may reflect domestic caution.

📉 Technical & Entry Zone

Current Price: ₹304

DMA 50/200: ₹286 / ₹255 — trading above key averages.

RSI: 55.9 — neutral zone.

MACD: 7.60 — bullish momentum.

Suggested Entry Zone: ₹220–₹250 range, ideally near DMA 200 or ₹200 support.

🕰️ Long-Term Holding Guidance

Avoid fresh entry at current levels due to extreme valuation and weak fundamentals.

Hold only if speculative exposure is intended, not for core portfolio.

Ideal for long-term only if

Profitability improves consistently.

Valuation normalizes below P/E 100 and PEG < 2.

Would you like a comparison with other renewable energy players like Adani Green or KPI Green Energy?

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