Solex Energy: A SmallCap Stock Poised for 400% Revenue Growth by FY27

Solex Energy is planning a significant expansion of its business over the next few years, aiming to increase its revenues from Rs. 662.2 crore to Rs. 3,300 crore by 2027. India’s solar sector is experiencing rapid growth, and Solex Energy is focusing on expanding its operations and exploring new opportunities to strengthen its position in the energy market.

Solex Energy Ltd, with a market capitalization of Rs. 1,209.88 crore, recently closed at Rs. 1,120 per equity share, down by 1.43 percent from its previous day’s close price of Rs. 1,136.20 per equity share. The company has delivered varying returns across multiple timeframes, with a 3-month return of -35.82 percent, a 6-month return of -9.54 percent, and a 1-year return of -16.36 percent. However, over the longer term, the company has achieved a 5-year return of 3,877.27 percent, from Rs. 26.40 to the current level of Rs. 1,120.

Solex Energy Limited, founded in 1995 and based in Surat, Gujarat, manufactures and sells solar photovoltaic modules in India. The company provides a range of solar solutions, including rooftop and off-grid systems, utility-scale plants, and EPC services, catering to sectors such as government, agriculture, healthcare, education, real estate, and telecom.

Revenue Guidance

The company plans to achieve nearly fourfold topline growth by FY27E, with revenue increasing from Rs. 662.2 crore in FY25 to Rs. 2,000 crore in FY26E. Of this, around Rs. 1,337.8 crore is expected to be added in H2 FY26, while revenues are projected to further scale up to about Rs. 3,300 crore by FY27E, reflecting a strong medium-term growth outlook.

India’s Renewable Push

The Indian government’s ambitious plan to achieve 500 GW of renewable energy by 2030 has created a favorable environment for solar manufacturers. Initiatives such as PM KUSUM, which subsidizes solar pumps for farmers, and PLI incentives for domestic solar manufacturing have injected significant liquidity and demand into the sector.

Manufacturing Expansion Plans

Solex is aggressively scaling its production capabilities to meet growing domestic and international demand. Its current 4 GW module manufacturing facility in Gujarat is set to expand to 10 GW by 2030, with expansion into ingot and wafer manufacturing. This backward integration reduces reliance on Chinese imports, protects margins, and ensures that Solex can deliver high-quality, cost-competitive modules to both domestic and export markets.

Past Financial Track-Record

Over the past five years, Solex has exhibited impressive financial growth. Sales rose from Rs. 138 crore in FY20 to Rs. 660 crore in FY25, EBITDA increased from Rs. 7 crore to Rs. 69 crore, and net profits surged from Rs. 4 crore to Rs. 40 crore. The company’s revenue growth has been driven by strategic EPC contracts and a focus on higher-value module sales, positioning it as both a story stock and a spreadsheet stock.

Solex Energy has leveraged this macro tailwind while demonstrating operational efficiency, with a 10-year average ROCE of 24 percent and a Return on Equity of 39 percent in FY25. The firm’s strong operating margins and capital efficiency have enabled it to reinvest profits into expansion while maintaining high profitability.

Technology Innovation

At the Renewable Energy India Expo (REI 2025), Solex unveiled its TaPi – RC series Back Contact (BC) module, which will enter commercial production in the second half of 2026. The module features 132 half-cut BC cells with no front grid lines, delivering power output of 635–665 W and an efficiency of up to 24.6 percent. Developed in partnership with Germany’s ISC Konstanz, the module represents a technological leap for Solex, combining aesthetic appeal with high efficiency. The BC module is designed for independent power producers and solar developers, reflecting the company’s focus on high-value, performance-driven products.

Global Ambitions and U.S. Market Strategy

Beyond domestic growth, Solex is targeting the U.S. solar market, which accounts for 90 percent of India’s solar module exports. High anti-dumping duties on Chinese products create a unique window for Indian manufacturers. By producing critical components such as cells, wafers, and ingots domestically, Solex is positioning itself as a cost-effective, fully non-Chinese supplier for U.S. developers. The company is raising capital in stages, including a Rs. 5 billion institutional fundraise, to support its expansion and global ambitions.

Future Outlook

EBITDA Margin Outlook

Solex Energy has guided to maintain EBITDA margins of 9–11 percent in FY26, indicating a focus on balancing rapid revenue growth with operating efficiency as capacity expansion and EPC execution scale up.

Net Profit (PAT) Guidance

On profitability, the company has outlined an aspirational PAT of Rs. 120–160 crore in FY26, which is expected to rise sharply to Rs. 264–330 crore by FY27 as higher capacity utilization and operating leverage begin to reflect in earnings.

Corresponding to the profit growth, Solex is targeting an NPM of 6–8 percent in FY26, with margins expected to improve further to 8–10 percent in FY27, supported by scale benefits, improved cost absorption, and a maturing business mix.

Risks and Considerations

While the growth story is compelling, investors should consider several risks. Solex, as a small-cap company, experiences quarterly earnings volatility, partly due to seasonality and monsoon-related project delays. Its supply chain, although increasingly integrated, still depends on raw materials such as wafers and silver, which are globally concentrated. Additionally, U.S. tariffs and policy changes could affect export potential. The company’s long-term borrowing has also increased from Rs. 5 crore in 2020 to Rs. 293 crore in September 2025.

Solex Energy is emerging as a small-cap powerhouse in India’s solar sector. By combining technological innovation, backward integration, and global market ambitions, the company is poised to capture a significant share of domestic and international solar markets. Its roadmap from Rs. 662 crore in revenues to Rs. 3,300 crore by FY27 demonstrates both ambition and execution capability, making Solex a company to watch for investors seeking exposure beyond India’s headline solar giants.