SWSOLAR - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 2.9

📊 Core Financials Analysis

Profitability

Quarterly PAT dropped significantly (₹32 Cr vs ₹55 Cr), despite a high Qtr Profit Var of 663% — likely due to a low base effect.

ROE: 8.24% and ROCE: 16.0% — moderate, not exceptional for a growth company.

EPS: ₹4.68 — low relative to price, indicating stretched valuation.

Debt & Leverage

Debt-to-equity: 0.93 — high for a renewable energy firm, could constrain future growth.

No dividend yield — reinvestment strategy, but limits income appeal.

📉 Valuation Indicators

Metric Value Insight

P/E Ratio 62.2 Extremely high — priced for perfection

P/B Ratio ~6.73 Expensive on asset basis

PEG Ratio 2.23 Overvalued even after adjusting for growth

Intrinsic Value Likely < ₹290 Weak earnings and high valuation suggest limited margin of safety

🧠 Business Model & Competitive Advantage

SWSOLAR (Sterling and Wilson Renewable Energy) operates in solar EPC and energy services.

Strengths

Exposure to fast-growing renewable sector

Global project footprint

Weaknesses

High debt burden

Earnings volatility

Weak institutional sentiment (FII/DII holdings declining)

📌 Entry Zone Recommendation

RSI: 37.9 — nearing oversold, but not yet a reversal signal.

MACD negative — bearish trend intact.

Support Range: ₹240–₹260 may offer a safer entry, but only for high-risk investors.

Avoid chasing above ₹320 unless earnings and debt profile improve.

🕰️ Long-Term Holding Guidance

Speculative long-term hold — only if bullish on solar sector and willing to tolerate volatility.

Watch for debt reduction, margin expansion, and order book growth.

Better suited for thematic exposure than core portfolio stability.

Would you like a solar sector overview or comparison with Adani Green or Tata Power next?

Edit in a page