ACME Solar Holdings Limited (ASHL) has announced plans to significantly increase its ownership in its subsidiary, ACME Sigma Urja Private Limited. The company intends to raise its stake from the current 49% to 99.66% through a strategic investment of ₹1.5 crore.

Investment Details

ASHL will subscribe to 15,00,000 fully paid equity shares of ACME Sigma Urja at face value, as approved by the Operational Committee of the Board of Directors on October 10, 2025. Here are the key details of the transaction:

Strategic Implications

This move aligns with ASHL's commitment to the development and funding of renewable energy projects. As per the Shareholders Agreement dated June 17, 2024, ASHL is responsible for the overall development, commissioning, and funding of projects undertaken by ACME Sigma Urja.

Regulatory Compliance

The transaction has received necessary approvals:

1. Audit Committee approval: August 27, 2025
2. Board of Directors approval: August 27, 2025
3. Shareholders' approval: September 29, 2025 (10th Annual General Meeting)

The company has confirmed that the transaction will be conducted at arm's length, adhering to regulatory requirements for related party transactions.

About ACME Sigma Urja

ACME Sigma Urja Private Limited, incorporated on October 16, 2023, is focused on renewable energy generation. The company, which is yet to commence operations, had nil turnover in both FY 2023-24 and FY 2024-25.

Market Impact

This strategic move by ACME Solar Holdings demonstrates its commitment to expanding its renewable energy portfolio and strengthening its position in the growing clean energy sector. The increased stake in ACME Sigma Urja is expected to give ASHL greater control over project development and execution, potentially leading to improved operational efficiencies and faster project implementation.

Investors and market watchers will likely keep a close eye on how this increased ownership translates into tangible projects and revenue generation for ACME Solar Holdings in the coming quarters.

ACME Solar Holdings Limited (ASHL) has received a significant boost to its credit profile, with CRISIL Ratings upgrading its rating on the company's long-term bank facilities to 'CRISIL AA-/Stable' from 'CRISIL A+/Positive'. This upgrade, marking ACME Solar's highest rating to date, reflects the company's robust growth and improved financial metrics.

Key Highlights of the Rating Upgrade

• Facilities Rated: Rs. 1,000.00 crore (enhanced from Rs. 350.00 crore)
• New Rating: CRISIL AA-/Stable
• Previous Rating: CRISIL A+/Positive

Factors Contributing to the Upgrade

The rating upgrade is attributed to several positive developments:

1. Operational Growth: ASHL has demonstrated healthy growth in its operating portfolio, commissioning 1,550 MW of renewable capacities.
2. Strong Execution: The company has established a solid track record in project execution and timely asset stabilization.
3. Improved Financial Performance: ASHL has successfully refinanced projects at lower interest rates, enhancing its operating cash flows.
4. Robust Project Pipeline: The company has a signed PPA/BESPA portfolio of 2.84 GW Solar FDRE, Hybrid, and Wind Projects, along with a 550 MWh standalone BESS project.

Financial Outlook

CRISIL Ratings projects ASHL's consolidated EBITDA to improve significantly:

This growth is expected to support a healthy consolidated adjusted debt service coverage ratio (ADSCR).

Liquidity and Cash Position

ASHL maintains a strong liquidity profile:

• Consolidated Free Cash & Cash Equivalents: Over Rs. 1,400.00 crore
• Standalone Cash Position: More than Rs. 800.00 crore

This robust cash position is anticipated to support future equity requirements and any contingency needs.

Operational Portfolio

ASHL's operational asset base stands at 2.89 GWAC, with projects spread across:

• More than 11 states
• 17 counterparties
• 100% tied up in long-term 25-year power purchase agreements (PPAs)

Future Outlook

The 'Stable' outlook reflects CRISIL's expectation that ASHL will continue to benefit from:

1. Sustained operational performance at or above P-90 levels
2. Long-term PPAs with off-takers
3. Prudent capital allocation towards future capacity additions

Potential Risks

While the outlook is positive, CRISIL has identified potential risks:

• Implementation and stabilization risks associated with the under-construction portfolio
• Susceptibility to weather patterns affecting plant load factor (PLF)
• Possible stretches in debtor days (currently at 42 days as of March 2025)

Conclusion

The upgrade to 'CRISIL AA-/Stable' underscores ACME Solar Holdings' strengthening position in the renewable energy sector. With a robust operational portfolio, strong project pipeline, and improved financial metrics, the company is well-positioned for sustained growth. However, investors should remain mindful of the inherent risks associated with the renewable energy sector and the company's expansion plans.