5 Solar Energy Stocks to Watch in 2025: Set to Gain from Capacity Expansion

Over the past six months, India's stock market has gone through a rollercoaster ride, Sharp corrections, inflationary jitters and global recession fears, shifted investor sentiment and kept traders on the sidelines.

Even solar energy stocks, once riding high on green energy optimism, faced setbacks.

But as the dust is settling, a new narrative is taking shape: the sector isn't fading; it's quietly recovering.

With India's relentless push toward its 500 GW renewable energy target by 2030, falling solar equipment costs, and a flood of foreign investments into green infrastructure, the market appears to be consolidating-laying the groundwork for its next leg of growth.

Corporate giants, from Adani to Tata, are doubling down on solar. With this in mind, let's see 5 solar energy stocks set to shine in the future.

Take a look...

#1 Adani Green Energy

First on the list is Adani Green Energy, a leading renewable energy company in India, with a stated target of achieving 50 GW of operational capacity by 2030, including significant energy storage.

The company operates a large portfolio of solar, wind, and hybrid projects, with a growing focus on pumped hydro storage and battery energy storage solutions.

Coming to its financial performance, the company has delivered a solid top-line growth of 43% compounded annual growth rate (CAGR) over a 3-year period and a net profit CAGR of 68%. The last 3-year return on equity (ROE) has been 18%.

But this performance has not been enough to arrest the freefall that the stock is experiencing for the last 1 year.

Here's how the stock price has performed in the past 1 year.

Many factors have contributed to this fall in price. In November 2024, US authorities indicted Gautam Adani, chairman of the Adani Group, along with other executives, alleging involvement in a bribery scheme to secure solar power contracts in India.

These charges have raised concerns about corporate governance and legal compliance within the company.

Following this, TotalEnergies, a big investor, announced a pause on new financial contributions to Adani Group companies until the accusations are clarified. This undermined investor confidence and impacted the stock price. The demanding valuations clearly didn't help.

Looking ahead, the company has ambitious growth plans it's targeting 50 GW of operational renewable energy capacity by 2030, including at least 5 GW of pumped hydro storage.

It's developing the world's largest single-location renewable energy plant of 30 GW at Khavda in Gujarat. It aims to operationalise the plant by 2029.

The company is targeting 6 GW of new capacity in FY25. As of late January 2025, it has already added 3.1 GW. It expects to commission a significant new capacity in the final quarter of FY25, aiming for a total of 5 GW for the year.

For FY26 and beyond, AGEL plans to maintain a minimum run rate of 6 GW capacity addition per year.

It also expects to add around 1 GW of wind capacity in FY25. The long-term target is a mix of solar, wind, and hybrid projects.

The company's growth is fully funded through a US$ 3.4 billion (bn) revolving construction facility and equity infusion from strategic partners like TotalEnergies and promoter warrants.

The company does not anticipate needing further equity raises for its 50 GW target. It aims to maintain a disciplined capital management approach with a net debt to EBITDA of around 4.

For more details, check out Adani Green Energy's financial factsheet.

#2 Tata Power Company

Coming second on the list is Tata Power Company, India's largest vertically integrated power company with a presence across the entire power value chain.

Tata Power has a significant presence across India and also has international operations in Bhutan, Georgia, Zambia, Indonesia (coal mines), Singapore, South Africa, and Mauritius.

The company is committed to a sustainable energy transition, aiming for 70% clean and green capacity by 2030 and net zero emissions before 2045.

Coming to its financial performance, the company has delivered a solid top-line growth of 23% CAGR over a 3-year period and a net profit CAGR of 44%.

The last 3-year ROE has been 11%.

The growth has slowed down in the recent financial year, which has resulted in a stagnant price performance.

Here's how the stock price has performed in the past 1 year.

Looking ahead, Tata Power has outlined ambitious future plans, particularly focusing on the renewable energy sector.

In the first nine months of FY25, the company spent nearly Rs 120 billion (bn) in capex, equalling the total capex of the previous financial year. Plans include spending another Rs 120 bn in Q4 FY25, bringing the total to about Rs 220 bn for FY25.

This capex is directed towards various projects in renewable energy, group captive, manufacturing (4.3 GW cell and module plant), and transmission and distribution.

The company aims for a capex run rate of Rs 200 bn per annum over the next 2-3 years. The breakup for this capex includes investments in traditional generation, pump storage, transmission, distribution, and renewables.

The renewable business is expected to be a major growth driver, with a target of 2 to 2.5 GW of renewable capacity additions annually in FY26 and FY27.

Currently the 4.3 GW module plant is operating at over 90% utilisation. An additional 2 GW Mono PERC cell line was commissioned in December 2024, and a 0.3 GW TOPCon cell line is expected to be commissioned in Q4 FY25.

The cell plant is expected to be fully stabilised by the beginning of FY26. Tata Power has secured a Rs 4.55 bn contract to supply 300 MWp ALMM modules to Maharashtra State Power Generation Company.

It's exploring the potential of clean energy and digital technologies, including hybrid meter technology and RFID-enabled 'EZ CHARGE' cards. It's also developing advanced algorithms for EV load forecasting and smart charging solutions for buses.

In summary, Tata Power has a robust future outlook driven by significant investments in renewable energy and infrastructure.

For more details, check out Tata Power Company's financial factsheet.

#3 NTPC Green Energy

On number three comes NTPC Green Energy a 'Maharatna' central public sector enterprise. it is the largest renewable energy public sector enterprise (excluding hydro) in India in terms of operating capacity as of 30 September 2024.

Coming to its financial performance, since the company has just recently listed and carved out of NTPC there is limited financial data available.

The recent showed stable performance with revenues and EBITDA broadly remaining in the same range. The stock price has been a little bit more volatile.

Here's how the stock price has performed since its listing.

Looking ahead, the company aims to continue growing its project pipeline through prudent bidding and strategic joint ventures. It is also focusing on projects in new energy solutions like green hydrogen, green chemicals, and energy storage systems.

It is developing a green hydrogen hub at Pudimadaka and finalizing a tie-up for electrolysers.

NTPC Green Energy has a long-term plan to reach a green energy capacity of 60 GW by 2032, which is projected to require a total capex of Rs 3-3.5 trillion (tn).

By the end of FY25, it plans to reach 6 GW capacity, and 11 GW the following year, and 19 GW by March 2027, with a planned investment of Rs 1 tn.

The capacity mix is expected to be around 90% solar and the remaining wind.

It's worth noting that NTPC Green Energy may consider a follow-on offering after three years of its listing to comply with minimum public shareholding norms and potentially a rights issue at some point in the future.

For more information, check out NTPC Green Energy's financial factsheet.

#4 Waaree Energies

Fourth on the list is Waaree Energies. It is primarily involved in the manufacturing of solar PV cells and solar PV modules. It's the largest solar module manufacturer in India.

Additionally, Waaree also undertakes engineering, procurement, and construction (EPC) activities for solar power plants, which contributes between 8-10% of sales. The company also trades in solar-related products such as water heaters and water pumps.

The company has delivered a solid top-line growth of 80% CAGR over a 3-year period and an even more impressive net profit CAGR of 180%.

The last 3-year ROE has been 35%.

If the same growth is maintained in coming future the stock could come out of the consolidation that it is in currently.

Here's how the stock price has performed in since its listing.

Coming to its future plans, Waaree Energies has outlined significant plans for both the expansion of its existing businesses and diversification into new, related sectors within the renewable energy landscape.

It has completed a 5.4 GW solar cell manufacturing line in Chikhli, Gujarat. Commercial production of 1.4 GW capacity commenced in February 2025, and the remaining 4 GW capacity is expected to start commercial production soon.

Waaree is also in the process of setting up a 6 GW integrated solar manufacturing capacity in Odisha, which will include wafer, cell, and module production. This facility is expected to be commissioned in a phased manner by the end of FY27.

Its module manufacturing capacity has increased from 12 GW at the end of December 2023 to 14.9 GW by the end of February 2025. This includes a 1.3 GW line under their wholly-owned subsidiary Indosolar and 1.6 GW capacity in Texas, USA, under Waaree Solar Americas.

The company has further approved the establishment of an additional 1.6 GW module manufacturing line in Texas, and another 3.2 GW of module manufacturing capacity at its plant in Chikhli, Gujarat.

The company is not growing only organically but also actively engaging in acquisitions. It has signed a share purchase agreement to acquire 100% stake in Enel Green Power India (Enel) for about Rs 7.9 bn. Enel has an operational portfolio of 640 MWac (750 MWdc) and 2 GW of capacity under development.

The company is also planning for future by actively pursuing diversification. The board has approved venturing into the green hydrogen and electrolyser business with an investment of Rs 5.5 bn.

It has been awarded a PLI for a 300 MW electrolyser manufacturing facility and has won a SECI bid for 90,000 tons of green hydrogen production. Its electrolyser manufacturing plant is expected to be operational by Q2 FY27.

Waaree plans to enter the battery energy storage systems (BESS) sector with an investment of Rs 20.7 bn. It aims to establish a 3.5 GWh capacity battery manufacturing plant, expected to be operational by Q2 FY27.

The company has a healthy order book of 26.5 GW as of December 2024, about Rs 500 bn. It's aiming to increase the share of domestic orders to around 50% in the near term.

For more information, check out Waaree Energies' financial factsheet.

#5 Premier Energies

Premier Energies a leading Indian manufacturer of solar cells and modules.

The company has a long-standing track record in the solar industry, with 29 years of experience in module manufacturing. It was one of the first Indian companies to manufacture solar cells.

Coming to its financial performance, the company has delivered a solid top-line growth of 65% CAGR over a 3-year period and a net profit CAGR of 119%.

The last 3-year ROE has been 16%.

Stock has not performed after its IPO.

Here's how the stock price has performed in since its listing.

Premier Energies has ambitious future growth plans focused on significant capacity expansion and backward integration.

A 1 GW TOPCon cell and module line is expected to be completed by Q1 FY26. A 4 GW TOPCon cell and module line is expected to be completed by Q1 FY27.

With these expansions, the total capacity by June 2026 is projected to reach 7 GW per annum for solar cells and 9.1 GW per annum for modules.

There is also a plan for a 1.2 GW per annum cell line in the US by FY28, with civil works and equipment in progress for the module line (Q4 FY26) and cell line (Q1 FY27), although this is currently under review due to policy uncertainties in the US.

The company is also backward integrating into wafers. A 2 GW per annum wafer manufacturing plant is planned to be commissioned by FY26. Equipment for this facility has been ordered. This will be in a JV with a Taiwanese manufacturer.

Similarly, a 36,000 metric ton per annum aluminium frame manufacturing facility is being set up to meet the company's full captive needs, increase value addition, and boost margins. This is targeted to be commissioned by FY26 and will require a capex of Rs 2.3 bn. This is expected to improve EBITDA margins by 1-1.5%.

These expansion plans are supported by the proceeds from the IPO in September 2024, which strengthened the balance sheet and will fund a substantial portion of the capex.

The company is optimistic about the prospects of the solar sector, aided by rising demand, favourable government policies, and improving technology.

For more information, check out Premier Energies' financial factsheet.

Conclusion

India's solar energy sector is poised for transformative growth. Companies are spearheading innovation through massive capacity expansions, cutting-edge storage solutions, and diversification into green hydrogen and battery technologies.

However, investors must tread cautiously. Operational risks-project delays, supply chain bottlenecks, and execution hurdles-loom large, as seen in Premier Energies' delayed TOPCon line and Waaree's phased expansions.

Governance concerns, like Adani's legal scrutiny and policy uncertainties, such as shifting US tariffs, add layers of complexity.

Market volatility, valuation pressures, and the capital-intensive nature of renewable projects further demand rigorous due diligence.

In this dynamic landscape, the solar sector offers a compelling narrative of growth, but success hinges on balancing ambition with prudence. Investors should prioritise companies with transparent governance, strong execution track records, and resilient financials, while staying attuned to macroeconomic and regulatory shifts.

The sun is rising on India's renewable revolution, but navigating its path requires both optimism and vigilance.

Therefore, investors must evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

Happy investing.

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