Waaree and Premier Energies Drive Growth Through US Exports

Indian solar module makers Waaree Energies Ltd and Premier Energies Ltd are seeing significant growth from exports, particularly to the United States. While India’s domestic solar market remains strong, higher profitability in export markets drives these companies to expand overseas.

Export Markets Drive Revenues

• Waaree Energies: India’s largest solar module manufacturer earned 58% of its FY24 revenues from exports, with the US as its key market.
• Premier Energies: While US exports contributed 8.77% to its FY24 revenues, the company holds a 100% share of Indian solar cell exports to the US, making it the leading exporter in this category.

Why Exports Are More Profitable

The return on capital employed (ROCE) varies significantly:

• Manufacturing solar modules in India yields a ROCE of 22%-28%.
• Exporting these modules to the US boosts ROCE to over 72%.

Factors contributing to this profitability include backward integration, less competition, and the strategic advantages of manufacturing closer to export markets.

Expansion Plans in the US

• Waaree Energies: The company is testing production at its new 1.6 GW solar module plant in the US. It also plans to establish a 3.4 GW solar module and 5 GW solar cell manufacturing facility there. Waaree is optimistic about the growth potential due to cost benefits in the US market.
• Premier Energies: In partnership with Canada’s Heliene Inc., Premier Energies plans to set up a 1.2 GW solar cell plant in the US. However, the company is cautious and monitoring how US policies, like the Inflation Reduction Act, may affect its expansion plans.

Strategic Focus on the US

The US market offers lucrative opportunities for Indian solar companies, and Waaree and Premier Energies are tailoring their strategies to maximise returns while adapting to market and policy changes.

About Waaree Energies Limited

Waaree Energies Limited, established in December 1990, is an Indian company specializing in manufacturing solar PV modules. It has a total production capacity of 12 GW and operates five manufacturing plants in India, along with a presence in international markets.

As of January 15 at 10:19 AM, Waaree Energies share price is ₹2,624.95, reflecting a gain of ₹7.85 (0.30%) for the day. The stock opened at ₹2,655.00 and has traded between a high of ₹2,684.90 and a low of ₹2,617.25. With a market capitalisation of ₹75,410 crore, the company’s 52-week high is ₹3,743.00, and its 52-week low is ₹2,300.00.

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