Sterling & Wilson Renewable Energy reported its highest annual turnover since listing at INR7,548 crores in FY26, marking a 20% increase over the previous fiscal year. The company achieved its highest quarterly profit after tax since listing at INR142 crores in Q4 FY26, though the full-year results were impacted by exceptional litigation costs of INR611 crores, leading to an annual loss of INR296 crores.

The company's operational performance remained robust during the fiscal year. New EPC orders grew 43% year-on-year to INR10,062 crores, significantly exceeding the conservative projection of 15% growth made at the start of the fiscal year. The unexecuted order value reached a record INR11,813 crores compared to INR9,096 crores in the previous fiscal, providing strong visibility for future earnings. Domestic orders comprise approximately 78% of the current unexecuted order book at about INR9,250 crores.

Financial Performance Highlights

Gross margins improved to 10.50% in FY26 from 10.10% in FY25, primarily driven by the International EPC segment where margins increased to 13.20% from 8%. Operational EBITDA grew 53% year-on-year to INR444 crores, with an operational EBITDA margin of 5.90%. Annual recurring overheads remained steady at INR349 crores despite higher revenue growth, demonstrating operational leverage.

Operational Achievements

The company successfully commissioned 4.50 gigawatt AC (equivalent to 5.90 gigawatt DC) of solar PV projects across India and international markets during FY26. This represents approximately 15% of the total solar utility scale installations in India during the fiscal year, which stood at 28.30 gigawatt AC according to Ministry of New and Renewable Energy data.

The operations and maintenance segment demonstrated significant growth, with the total portfolio size increasing to 13.50 gigawatts from 8.70 gigawatts in the previous fiscal. The company's employee headcount expanded to approximately 3,500 compared to 2,500 a year ago, reflecting investments in building scale for multiple gigawatt-scale projects.

Order Book and Market Position

During the fiscal year, the company secured 12 new orders, including 11 EPC orders totaling nearly 5.20 gigawatt DC and one pure battery storage project of 790 megawatt hour. In the Indian market, the company won 10 projects totaling 4.80 gigawatt DC with an order value of INR7,659 crores, representing approximately 30% growth in domestic order inflows by value.

Management Guidance and Outlook

During the earnings conference call held on April 24, 2026, management provided comprehensive guidance for the coming fiscal year. CEO C.K. Thakur highlighted that the current bid pipeline targets approximately 31 gigawatts overall, with India accounting for more than 27 gigawatts. The company expects strong momentum from the battery storage market, with opportunities estimated at over 50 gigawatt hour.

Management expects approximately 20% of new orders could come from battery storage opportunities. The company anticipates EPC gross margins to range between 8% to 10% and O&M gross margins to stabilize around 20%. Revenue growth guidance of approximately 15% is based on current order book and expected order inflows, excluding potential orders from Reliance New Energy.

Balance Sheet Improvements

Debt levels declined by INR149 crores compared to the previous quarter, reflecting stronger cash flow generation and scheduled repayments. Net working capital improved to negative INR329 crores from negative INR407 crores in the previous quarter. The company has cumulatively raised fresh credit lines of nearly INR2,800 crores during the fiscal year.

CFO Ajit Pratap Singh noted that the company's credit rating improved from BBB- to BBB+ during the year, with banks providing continued support through additional sanctions and reduced costs for letters of credit and bank guarantees.

Sterling & Wilson Renewable Energy has reported significant challenges affecting the renewable energy sector's project development activities during Q4 FY26. The company highlighted that external market factors have created headwinds for the industry's growth trajectory.

Market Challenges Impact EPC Activities

The company reported that unforeseen geopolitical issues have contributed to a slowdown in EPC ordering activities by developers in Q4 FY26. These geopolitical uncertainties have created an environment of caution among project developers, leading to delayed decision-making processes for new renewable energy projects.

Commodity Price Volatility Affects Sector

Volatile commodity prices have emerged as another significant factor impacting the renewable energy sector during this period. The fluctuating prices of essential materials and components used in renewable energy projects have added complexity to project planning and cost estimation processes.

Developer Activity Slowdown

The combination of geopolitical issues and commodity price volatility has resulted in reduced EPC ordering activities by developers. This slowdown reflects the broader challenges facing the renewable energy sector as stakeholders navigate uncertain market conditions and assess project viability under current circumstances.

The reported challenges highlight the interconnected nature of global markets and their impact on renewable energy project development, with external factors playing a crucial role in shaping industry dynamics during Q4 FY26.