Shares of both Premier Energies and Waaree Energies declined significantly on January 5, 2026, following Bernstein's reiteration of its bearish stance on both solar companies. Despite acknowledging them as "good companies," the brokerage firm maintains concerns about the sector's near-term prospects.

Price Target Revisions and Market Performance

Bernstein's latest note included mixed price target adjustments for both companies:

The market reaction was swift, with both stocks experiencing significant declines:

Oversupply and Demand Concerns

Bernstein's bearish thesis centers on anticipated oversupply in the solar sector. The brokerage believes that despite Premier and Waaree being fundamentally sound companies, they cannot justify higher multiples on peak margins when a significant supply wave is expected within 12-18 months.

The firm highlighted two key concerns:

• Supply Wave Impact: A major supply increase expected in the next 12-18 months
• Soft Demand Story: Market underestimating potential demand weakness

Timeline Expectations and Margin Compression

Bernstein's outlook differs significantly from market consensus regarding demand recovery timing. The brokerage expects solar additions to moderate and anticipates demand for domestic cells from utility scale players to emerge only from FY 2028-2029, contrary to market expectations of mid-FY 2027.

The firm warned that margin compression signs for these companies will become visible from Q3 FY26 results, suggesting near-term pressure on profitability.

Analyst Coverage and Recent Developments

Despite Bernstein's bearish stance, both companies maintain relatively positive analyst coverage:

Premier Energies (12 analysts):

• Buy: 6 analysts
• Hold: 2 analysts
• Sell: 4 analysts

Waaree Energies (13 analysts):

• Buy: 9 analysts
• Sell: 4 analysts

Meanwhile, Waaree Energies announced that its subsidiary, Waaree Energy Storage Solutions, completed a major funding round worth ₹1,003.00 crore from strategic investors, family offices, and high networth individuals, demonstrating continued investor interest despite sector concerns.

Waaree Energies shares witnessed significant selling pressure during Monday's trading session, declining 4.68% to hit an intraday low of Rs 2,724.30 on the BSE. The stock opened at Rs 2,856.45 against the previous close of Rs 2,866.60, extending its bearish trend for the eighth consecutive trading session.

Trading Activity and Volume Analysis

The solar energy company experienced exceptionally heavy trading activity during the session:

The substantial increase in trading volume, with 1.54 lakh shares changing hands compared to the 2-week average of 0.50 lakh shares, indicates heightened investor activity amid the price decline.

Recent F&O Inclusion Impact

Despite the National Stock Exchange including Waaree Energies in the Futures & Options segment effective from the January series beginning December 31, 2025, the stock has continued to face selling pressure. The company joined Swiggy and Premier Energies in gaining admission to the derivatives segment, yet this development has not provided immediate support to the share price.

Performance Across Multiple Timeframes

The stock's performance reveals consistent weakness across various periods:

The three-month decline of 20.64% represents the most significant drop among all measured periods, highlighting the intensifying selling pressure in recent months.

Technical Analysis and Market Position

Technical indicators paint a bearish picture for Waaree Energies:

The RSI reading of 34.70 suggests the stock is moving closer to oversold conditions, with readings below 30 typically indicating potential buying opportunities. However, the stock's position below all significant exponential moving averages confirms the prevailing bearish sentiment.

Leadership Transition Context

The recent trading weakness coincides with significant leadership changes at the company. CEO Amit Paithankar resigned from his position, with the board appointing Jignesh Rathod as the new CEO. The board acknowledged Paithankar's contributions in strengthening operational capabilities and expanding the company's market footprint during his tenure.