Sterling & Wilson Renewable Energy Limited delivered its strongest third quarter performance since listing, with revenue reaching ₹2,092 crores during Q3FY26, representing a robust 48% year-on-year growth. The renewable energy EPC specialist demonstrated strong execution capabilities while securing significant new orders that position the company for sustained growth.

Financial Performance Highlights

The company's financial metrics for Q3FY26 and nine-month period showcase consistent operational improvement:

The nine-month revenue growth of 48% significantly exceeded the company's initial guidance of 15-20% growth for the fiscal year. Operational EBITDA for the nine-month period surged 115% to ₹289 crores compared to ₹134 crores in the same period last year, demonstrating improved operational leverage as execution scales increased.

Major Order Wins and Strategic Partnerships

Sterling & Wilson secured four significant orders during Q3FY26 totaling ₹3,086 crores, with the highlight being a gigawatt-scale project from Adani Green Energy. The key order wins include:

The company entered into a multi-year strategic partnership framework agreement with Adani Green Energy Limited, extending beyond five years. This framework agreement establishes structured engagement for future utility-scale renewable deployments, with expectations of minimum 1 GW annual orders based on successful project delivery.

Revised Growth Guidance and Market Outlook

Management significantly revised its order inflow guidance upward, projecting over ₹11,000 crores for FY26 compared to the initial conservative estimate of 15% growth. Year-to-date order inflows have already reached ₹6,929 crores, representing more than 60% year-on-year growth. The revised guidance positions FY26 as potentially the most successful year in terms of order bookings for the company.

The domestic market continues to dominate the order book composition, with 75% of the current ₹10,413 crores unexecuted order value comprising Indian projects. International projects include advanced-stage developments in Europe and four projects in South Africa, all structured with favorable terms and risk allocation.

Operations and Maintenance Growth

The company's Operations and Maintenance (O&M) business achieved a significant milestone, crossing the 10 GW portfolio mark. This segment provides steady annuity revenue streams and is expected to contribute meaningfully to revenue stability and margin resilience as more large projects transition from construction to operational phases.

During Q3FY26, O&M margins were impacted by one-off expenses related to defect liability issues at an Australian project, resulting in margins of approximately 18% compared to the typical range of 20-25%. Management expects margins to normalize in subsequent quarters.

Balance Sheet and Financial Position

The company maintained its negative working capital cycle, with net working capital improving to negative ₹407 crores from negative ₹279 crores in the previous quarter. Net debt decreased by approximately ₹4 crores during the quarter, standing at ₹738 crores. The company successfully raised fresh funding of approximately ₹2,500 crores since the start of the fiscal year, including both fund-based and non-fund-based limits.

Interest costs increased during the quarter due to new borrowings, including a ₹500 crores loan from IREDA disbursed in September 2025 and an additional ₹100 crores from an NBFC. Management expects interest costs to gradually decrease in FY27 as loan repayments commence.

Future Prospects and Industry Positioning

Looking ahead, Sterling & Wilson anticipates 6-7 GW of orders likely to be tendered in Q4FY26 in India alone. The company continues active dialogue with Reliance New Energy for their multi-gigawatt renewable energy rollout, which would be additional to current guidance. For FY27, the company expects the market pipeline to exceed 30 GW, providing substantial opportunities for growth.

The battery energy storage system (BESS) market presents significant long-term opportunities, with India's installed BESS capacity currently at just 0.5 GWh as of June 2025, while the Central Electricity Authority estimates requirements of 34.7 GW by end of FY27. Sterling & Wilson's recent BESS project wins, including orders from JSW and Serentica, establish strong credentials in this emerging segment.

Sterling & Wilson Renewable Energy management has provided insights on the potential impact of China's export policy changes on the Indian solar market during a recent conference call.

Market Outlook and Price Stability

The company's management team expressed confidence that the Indian domestic solar market should remain largely unaffected by potential fluctuations in solar module pricing. This assessment comes in the context of anticipated changes to China's export rebate policies, which could influence global solar module supply chains.

China Export Rebate Impact Assessment

According to the management's analysis, any price variations that may arise from modifications to China's export rebate structure are expected to have minimal impact on India's domestic solar market. The leadership anticipates this market immunity will persist over the coming months, suggesting structural factors that may insulate the Indian market from external pricing pressures.

Strategic Market Position

The company's outlook reflects confidence in the stability and resilience of India's solar energy sector. This perspective indicates that domestic market dynamics may provide sufficient buffer against international supply chain adjustments and policy changes in key manufacturing regions.

The management's assessment during the conference call highlights their strategic view of market conditions and their expectations for continued stability in the Indian renewable energy landscape despite potential global market fluctuations.