As the renewable energy sector continues to gain momentum, one stock that’s catching the eye of investors is Sterling and Wilson Renewable Energy Ltd. (SWREL). With recent developments showcasing its strong orderbook and execution capabilities, this solar EPC (Engineering, Procurement, and Construction) provider is positioning itself as a compelling buying opportunity.
Recent Performance and Market Reaction
Following its September quarter results, SWREL’s shares have surged, hitting the 5% upper circuit limit for two consecutive days. This positive momentum reflects investor confidence, bolstered by the company’s strong guidance and robust orderbook.
Strong Revenue Guidance
Sterling and Wilson has set an ambitious revenue target of ₹8,000 crore for FY25. Impressively, the company has already achieved ₹2,000 crore in revenue during the first half of the fiscal year. Management has expressed confidence in their ability to execute projects effectively and meet the remaining ₹6,000 crore target in the upcoming quarters.
Growing Orderbook
During the recent earnings call on October 15, the management reported an exceptional growth in their unexecuted order value, reaching ₹10,549 crore as of Q2FY25—up from ₹8,084 crore in March 2024. This growth not only reflects the increasing demand for solar projects but also provides significant visibility for revenue in the upcoming quarters.
Additionally, SWREL has secured new orders in six domestic projects worth ₹2,044 crore since the June quarter. Most of these projects are concentrated in Gujarat and Rajasthan, regions known for their favorable solar energy conditions.
Company Background
Sterling and Wilson Renewable Energy is a leading player in the solar EPC sector, recognized globally for its comprehensive solar solutions. The company is also involved in the operation and maintenance (O&M) of solar power projects, further diversifying its revenue streams. Backed by the strong financial foundation of Reliance Industries, SWREL has a stable support system that enhances its credibility in the market.
Key Financial Metrics
- Market Capitalization: ₹14,513 crore
- Current Price: ₹622
- 52-Week High/Low: ₹828 / ₹253
- Book Value: ₹41.4
- Dividend Yield: 0.00%
- ROCE: 3.77%
- Face Value: ₹1.00
Conclusion
As the solar energy market continues to expand, Sterling and Wilson Renewable stands out as a strong candidate for investment. Its increasing orderbook, ambitious revenue targets, and solid execution capabilities make it a promising choice for those looking to enter the renewable energy space.
For investors seeking to capitalize on the growing demand for solar energy solutions, SWREL presents a compelling buying opportunity at its current levels. As always, it’s essential to conduct thorough research and consider market conditions before making investment decisions.
