Top 5 Fastest Growing Solar Energy Stocks to Watch Out for in 2025

• "Green energy investments, especially in solar, are not just socially responsible but also financially lucrative in the long run." - Warren Buffett

India, blessed with abundant sunlight throughout the year, is uniquely positioned to harness the power of solar energy to meet its growing energy demands.

As one of the fastest-growing economies, the nation faces rising electricity consumption and environmental challenges due to reliance on fossil fuels.

Solar energy presents a sustainable and clean solution, reducing greenhouse gas emissions and promoting energy security.

With the target to achieve 500 Gigawatt (GW) of renewable energy capacity by 2030, solar energy is pivotal for India's transition towards a greener, more resilient future.

Solar energy is the energy generated from the sun's rays. It is captured using technologies like photovoltaic (PV) cells, which convert sunlight into electricity, and solar thermal systems, which generate heat.

And how are these cells made?

The process starts with polysilicon, which is melted down and shaped into blocks called ingots. When these ingots are sliced, the pieces are called silicon wafers. After further cleaning, these wafers turn into solar cells. Finally, you get a solar module when you combine several solar cells.

When all the solar modules are combined, they form a solar panel, which is what converts sunlight into electricity.

The various types of products manufactured by solar energy-producing companies using these solar modules and allied components are as follows:

Hence, let's look at the top 5 fastest-growing solar energy companies selected from Equitymaster's screener for Fastest Growing Solar Energy Stocks.

These are not stock recommendations. Investors should do their own research and do due diligence before considering any investment in the stock market. Also, investors should pay close attention to corporate governance while performing their due diligence.

#1 Waaree Renewables Technologies

First on this list is Waaree Renewables Technologies.

Waaree Renewables generates power through renewable energy sources and provides consultancy services.

The company is one of the largest vertically integrated new energy companies. The company is India's leading solar module manufacturer and is recognised as a tier-one solar module producer globally.

The company has India's largest solar panel manufacturing capacity of 12 GW at its facilities in Gujarat. It plans to expand its cell manufacturing capacity by an additional 5.4 GW by FY25.

The company is a subsidiary of Waaree Group and caters to the solar engineering, procurement, and construction (EPC) business. The Waaree Group caters to individual, industrial, and commercial customers. The group has installed 10,000+ solar projects.

The company's business segments are as follows:

1. EPC Business: This division accounted for 98% of the total revenues in Q1 FY25 vs 91% in FY22. The company provides end-to-end EPC solutions, financing, constructing, owning, and operating solar projects.

   It provides clean energy to its clients by setting up both on-site solar projects (rooftop and ground-mounted) and off-site solar farms (open-access solar plants).

   It also offers off-grid inverters, solar products, water pump & streetlight modules, solar thermal solutions, on-grid inverters, lithium-ion batteries, as well as operation & maintenance (O&M) services.

2. Power Sale: This division accounted for 2% of the total revenues in Q1 FY25 vs 9% in FY22. The company generates some revenue by selling power.

Its clientele includes Adani, Aditya Birla Group, Bharat Petroleum, Larsen and Toubro, Mumbai Metro MMRDA, Reliance Industries Limited, etc. The company has commissioned projects across 13 states in India. It exports products to 68+ countries.

Here's a table showing the company's historical financials...

Financial Snapshot of Waaree Renewables Technologies

Rs m, consolidated	FY20	FY21	FY22	FY23	FY24
Net Sales	57	130	1,615	3,510	8,764
Growth (%)	-19%	128%	1144%	117%	150%
Operating Profit	4	70	235	837	2,072
OPM (%)	7%	54%	15%	24%	24%
Net Profit	-32	-38	86	554	1,481
Net Margin (%)	-56%	-29%	5%	16%	17%
Dividend per share (EPS)	0	0	0.2	0.2	1
Debt to Equity (x)	1.5	5.3	1.4	0.5	0.2
ROE (%)	-18	-9.8	34.1	96.9	94
ROCE (%)	1.7	7.6	26.7	84.1	103.2

Source: Equitymaster

In FY24, the company successfully executed projects totaling 704 megawatt-peak (MWp), a significant increase from 295 MWp in FY23, representing a year-on-year (YoY) growth of 138%.

During the same period, revenue surged by 150%. In Q1 FY25, the company executed an additional 217 MWp of projects.

As of Q2 FY25, the company has an unexecuted order book of 1.7 GW, valued at approximately Rs 25-27 bn. It has a significant pipeline of 17.8 GW, driven by government initiatives and the energy transition.

The company recorded its highest-ever quarterly revenues of Rs 5.2 bn in Q2 FY25, up nearly 3.5x YoY from Rs 1.5 bn in Q2 FY24.

Waaree Renewables recorded first-half FY25 revenues at Rs 7.6 bn, a growth of 172.7% YoY from Rs 2.8 bn in the same period last year.

The earnings before interest, tax, depreciation, and amortization (EBITDA) grew by 155% YoY to Rs 1.1 bn and the profit after tax (PAT) grew by 175.3% YoY to Rs 0.8 bn.

The company is concerned regarding EBITDA margins due to increased competition and pricing pressures, with current margin guidance of around 15%.

However, it reassured stakeholders that it would maintain double-digit EBITDA margins by focusing on profitable contracts.

Waaree Renewables' trade receivables are under control, with a typical working capital cycle of around twenty-one days, indicating efficient cash flow management.

The company operates with a negative working capital cycle, meaning it often receives client payments before incurring significant costs.

To know more, check out the Waaree Renewables Technologies financial factsheet.

#2 Gensol Engineering

Second on this list is Gensol Engineering.

Gensol Engineering is engaged in the business of solar consulting & EPC. The company is among the top 10 EPC players in India and the top 5 in terms of independent EPC players.

The company's business segments are as follows:

1. Solar Business: This division accounted for 83% of the total revenues in Q1 FY25 vs 97% in FY22. The company provides engineering, execution, and scaling of solar EPC projects, including turnkey solutions and balance of system services.

   It has expanded its offerings to include solar tracker technology and battery energy storage solutions (BESS). The key clients include Astral Pipes, GAIL, Trident Energy, etc.

   It has also expanded its footprint internationally with EPC projects in the UAE and other regions, incorporating a new subsidiary in FY24. This segment has grown by 5.3x between FY22 and FY24, and by 101% YoY in Q1 FY25, driven by a robust order book.

2. Electric Vehicle (EV) Lease Business: This division accounted for 17% of the total revenues in Q1 FY25 vs 3% in FY22. The company offers 100% EV-focused leasing solutions, including two-wheelers (2W), light commercial vehicles (LCVs), buses, three-wheelers (3W) cargo vehicles, etc.

   To date, it has leased more than 6,000 EVs. It has strategically increased its focus on EV solutions, resulting in revenue growth of more than 30x between FY22 and FY24, and by 100% YoY in Q1 FY25.

3. EV Manufacturing: It has established a manufacturing facility in Pune, with an investment of Rs 2.3 bn and a production capacity of 30,000 vehicles annually. It is moving toward the launch of its first Made-in-India, all-electric, 2-door, 2-seater car designed for urban Indian customers.

The company is also engaged in developing green hydrogen production infrastructure. In September 2024, it secured a project to develop India's first green hydrogen valley in Pune, in collaboration with Matrix Gas & Renewables Ltd.

Gensol has collaborated with Westinghouse USA to develop India's first bio-hydrogen project, converting 25 tons of bio-waste into 1 ton of hydrogen per day.

Here's a table showing the company's historical financials...

Financial Snapshot of Gensol Engineering

Rs m, consolidated	FY20	FY21	FY22	FY23	FY24
Net Sales	807	640	1,604	3,980	9,631
Growth (%)	-3%	-21%	151%	148%	142%
Operating Profit	41	64	192	779	2,298
OPM (%)	5%	10%	12%	20%	24%
Net Profit	22	32	111	234	596
Net Margin (%)	3%	5%	7%	6%	6%
Debt to Equity (x)	0.4	0.3	1.8	2.5	4.3
ROE (%)	9.6	9.2	26.9	18.4	20.1
ROCE (%)	16.2	12.2	22.6	13.4	15.4

Source: Equitymaster

The company saw its debt-to-equity ratio increase from 0.3 times in FY21 to 4.3 times in FY24 but also saw its revenue grow from Rs 640 million (m) to Rs 9,631 m during the same period, at a compounded annual growth rate (CAGR) of 146.9%.

This shows the company is actively investing in expanding its capacity, infrastructure, and capabilities to meet growing demand and sustain future growth.

As of Q1 FY25, the company has a total order book of Rs 50.3 bn, 93% of which is for solar and the remaining 7% is for EV leasing.

The company saw a revenue growth of 49% to Rs 7.1 bn and a PAT growth of 52% to Rs 0.5 bn in the first half of FY25.

The company anticipates significant opportunity in the BESS market, which is expected to grow at an 18-19% CAGR over the next 5-6 years. Gensol has secured its first two BESS projects, anticipating revenues of Rs 31 bn over 12 years, with EBITDA margins exceeding 90%.

The company has given revenue guidance of Rs 20 bn and EBITDA of Rs 4+ bn for FY25.

To know more, check out Gensol Engineering's financial factsheet.

#3 KPI Green Energy

Next on this list is KPI Green Energy.

KPI Green Energy is part of KP Group. The company develops, builds, owns, manages, and maintains renewable power facilities (solar and wind-solar hybrid power projects) as an independent power producer (IPP) and as an EPC service provider to captive power producers (CPPs) under the 'Solarism' brand.

The company runs its entire business in various districts of Gujarat. Currently, the company has an installed capacity of 171 MW of solar power, with orders in hand for 1.3 GW (the largest order book to date for KPI) under the IPP segment and 336 MW of EPC/CPP projects, with orders for 1.2 GW, indicating strong momentum in this segment.

The company's business segments are as follows:

1. IPP: This division accounted for 12% of the total revenues in H1 FY25. The company provides solar energy through a third-party sales business in Gujarat. It develops and maintains grid-connected IPP solar power projects under the 'Solarism' brand.

   The company supplies power from solar power plants to business houses through Power Purchase Agreements (PPAs).

2. CPP: This division accounted for 88% of the total revenues in H1 FY25. In the CPP model, the company develops, transfers, operates, maintains, and sells grid-connected solar power projects to customers.

   It does this by providing them with power evacuation infrastructure along with grid-connected land to generate solar power. It also offers O&M services.

3. Industrial Plot Sale: The company sells land parcels to third parties which are taken back on lease for 25 years for developing solar power plants. The company pays a fixed lease rental to landowners as per the lease agreement.

Its clientele includes Cadila Healthcare, Meghmani Organics, Songwon, etc.

Here's a table showing the company's historical financials...

Financial Snapshot of KPI Green Energy

Rs m, consolidated	FY20	FY21	FY22	FY23	FY24
Net Sales	593	1,035	2,299	6,438	10,239
Growth (%)	72%	75%	122%	180%	59%
Operating Profit	270	637	1,089	2,085	3,368
OPM (%)	45%	62%	47%	32%	33%
Net Profit	64	144	432	1,096	1,617
Net Margin (%)	11%	14%	19%	17%	16%
Debt to Equity (x)	1.4	2.1	2.2	2	1
ROE (%)	6.5	13.7	32.5	53.3	29.6
ROCE (%)	10.5	16.2	22.9	29.7	24.8

Source: Equitymaster

The company recorded total revenue for H1 FY25 at Rs 7.1 bn, marking a 75% YoY growth from Rs 4.1 bn in H1 FY24, EBITDA at Rs 2.7 bn compared to Rs 1.4 bn, growing by 87%.

This reflects efficient operations and strong cost management, and PAT doubled to Rs 1.4 bn compared to Rs 0.7 bn, indicating a 100% increase.

As of 30 September 2024, KPI Green Energy reported zero net debt on a standalone basis, indicating strong financial health.

The company is targeting an installed capacity of 10 GW by 2030, driven by a mix of IPP and CPP projects. It's actively exploring geographical diversification beyond Gujarat, with ongoing projects in Maharashtra and plans for Andhra Pradesh and Rajasthan.

Also, the company is adopting cutting-edge technologies to maximize efficiency.

KPI Green Energy expects a topline growth of 60-70% for FY25, supported by a strong order book and ongoing projects. The expected PAT margin is of 16% to 18%, with potential for improvement as the mix of IPP projects increases.

Currently, the outstanding EPC order book is approximately Rs 25-30 bn, with 70-80% of this won in FY25.

The management has acknowledged the competitive pressures within the sector and the potential impacts of international policy changes.

However, the company aims to address these challenges through its strong domestic focus, a robust order book, and its competitive edge in execution capabilities, backed by over a decade of experience in both the wind and solar energy sectors.

To know more, check out KPI Green Energy's financial factsheet.

#4 Waaree Energies

Fourth is Waaree Energies.

Waaree Energies is a manufacturer of solar PV modules. The company also engages in trading of solar components, including inverters, batteries, and solar water pumps, sourced from global suppliers.

Waaree Energies is India's largest manufacturer and exporter of solar modules. As of FY24, it holds a 21% share of the domestic market for solar modules and a 44% share in India's solar module exports. A reason for this was the significant increase in installed capacity, growing from 2 GW in FY21 to 13.3 GW by FY24.

The company generates 78%, 15%, and 7% of revenue from solar PV modules, solar EPC services, and energy storage systems & others, respectively.

The company exports solar PV modules to markets including the US, Canada, Italy, Hong Kong, Turkey, and Vietnam. The US is their largest export market, accounting for 57% of export sales.

Waaree Renewables operates five manufacturing facilities in India which are in Gujarat and Uttar Pradesh. These have a total installed capacity of 12 GW, as of June 2024.

The company is actively expanding its facilities to achieve a capacity of 20.9 GW by 2027. This expansion aims to reduce dependency on imported solar cells by establishing robust domestic manufacturing capabilities, emphasizing backward integration and self-reliance.

The top ten customers accounted for 57% of total revenue for FY24, reflecting a slightly higher dependency on a few customers.

Here's a table showing the company's historical financials...

Financial Snapshot of Waaree Energies

Rs m, consolidated	FY20	FY21	FY22	FY23	FY24
Net Sales	19,958	19,530	28,543	67,509	1,13,976
Growth (%)	25%	-2%	46%	137%	69%
Operating Profit	922	957	1,109	8,323	15,744
OPM (%)	5%	5%	4%	12%	14%
Net Profit	417	466	756	4,828	12,372
Net Margin (%)	2%	2%	3%	7%	11%
Debt to Equity (x)	0.4	1	0.9	0.5	0.2
ROE (%)	14.1	14	20.4	44.9	43.6
ROCE (%)	23	17.2	21.1	43.4	49.1

Source: Equitymaster

Production in H1 FY25 reached 3.3 GW, representing 70% of the total production of 4.8 GW achieved in the entire previous financial year, reflecting increasing demand and improved operational efficiency.

As of 30 November 2024, Waaree Energies boasts a substantial 20 GW order book for solar PV modules, out of which 27.5% is for domestic and 72.5% for overseas, indicating a strong international presence.

To know more, check out the Waaree Energies financial factsheet.

#5 Solex Energy

Next on this list is Solex Energy.

Solex Energy specializes in renewable energy solutions and manufactures solar PV cells, modules, and solar home lighting systems. It's also in the EPC business in the solar market.

Its operations include turnkey projects, spanning residential rooftops, and commercial, industrial, and utility ventures.

The company is engaged in original equipment manufacturing (OEM) and original design manufacturing (ODM) partnerships with Indian and international entities for module production under their brand names.

The company has a manufacturing facility in Surat which is undergoing capacity expansion and technology transition. Its current production capacity is 700 MW.

Solex's clientele includes Amul, ONGC, IOCL, Bank of Baroda, Canara Bank, Airport Authority of India, etc. It serves multiple industries like real estate, agriculture, manufacturing, and banking.

Here's a table showing the company's historical financials...

Financial Snapshot of Solex Energy

Rs m, consolidated	FY20	FY21	FY22	FY23	FY24
Net Sales	1,380	796	719	1,617	3,659
Growth (%)	-7%	-42%	-10%	125%	126%
Operating Profit	73	33	19	113	284
OPM (%)	5%	4%	3%	7%	8%
Net Profit	45	17	10	27	87
Net Margin (%)	3%	2%	1%	2%	2%
Debt to Equity (x)	0.2	0.5	0.6	1.8	2.1
ROE (%)	22.2	7.3	3.4	7.5	20.8
ROCE (%)	28.6	10.9	4.4	12	17.9

Source: Equitymaster

The company's debt-to-equity ratio increased from 0.5 in FY21 to 2.1 in FY24 but also increased its revenue from Rs 796 m to Rs 3,659 m during the same period, at a CAGR of 66.3%.

The company is actively investing in expanding its capacity, infrastructure, and capabilities to meet growing demand and sustain future growth.

It's executing a brownfield expansion to increase its solar module manufacturing capacity to a target of 4.0-4.5 GW, expected to be achieved by mid-FY26 (June 2025), along with establishing a 2 GW solar cell manufacturing facility as part of its strategic growth plan.

Solex's revenue for H1 FY25 reached Rs 2.7 bn representing a growth of 192% compared to H1 FY24, EBITDA grew by 167.7% to Rs 0.3 bn, EBIT margin increased by 294%, and PAT surged by 1,697% to Rs 0.1 bn, indicating strong operational performance.

The company's vision for 2030 includes plans for 15 GW of module manufacturing and 5 GW of cell manufacturing.

To know more, check out Solex Energy's financial factsheet.

Snapshot of Fastest Growing Solar Energy Stocks on Equitymaster Stock Screener

Here's a table showcasing the aforementioned stocks along with a few additional ones, evaluated across various important parameters.

Conclusion

Along with the capex done by each of the above companies, the government has also allocated Rs 85 bn (US$ 1.02 bn), a significant rise from the previous year's Rs 49.7 bn (US$ 0.60 bn) for solar power grid infrastructure development in its Interim Budget for 2024-2025.

Under Tranche II of the Production Linked Incentive (PLI) Scheme for the National Program on High-Efficiency Solar PV Modules, the government allocated Rs 19.5 bn (US$ 2.35 bn) for establishing 39,600 MW of fully or partially integrated solar PV module manufacturing units.

In April 2024, the government reintroduced the Approved List of Models and Manufacturers (ALMM), an official registry that manufacturers must join to supply government solar projects. This aims to reduce imports and ensure high-quality standards in Indian solar manufacturing.

Starting 1 June 2026, solar cells-the core components of solar modules-will also be included in the ALMM. This means not only must solar modules be made in India by approved manufacturers, but solar cells used in those modules will come from ALMM-listed companies.

These reforms and initiatives have led to a gradual transition from the import of solar PV inputs to being able to execute the entire solar manufacturing process domestically, paving the way towards Aatmanirbhar Bharat.

With the onset of a revolution in the solar energy industry, keep these stocks on your watchlist.

Happy Investing.

Disclaimer: This article is for educational purposes only. It is not a recommendation and should not be treated as such. Learn more about our recommendation services here...