SYNOPSIS: Indosolar, a 1.3-GW solar PV manufacturer, trades at a low valuation after revival under Waaree Energies, offering sector tailwinds and recovery potential, but faces earnings volatility, input-cost risks, and execution challenges, making it a stock worth watching.
Shares of a solar photovoltaic (PV) cell manufacturer with 1.3 GW of module capacity are currently in the spotlight. Trading at a P/E of nearly 10, the stock raises an obvious question: Does this valuation make it an attractive buying opportunity, or signal underlying concerns?
We are referring to Indosolar Limited. In this article, we’ll take a closer look at the company’s key positives and possible red flags to help investors better understand what’s really going on and make an informed judgment.
Indosolar manufactures and supplies monocrystalline silicon cell-based modules using advanced N-type TOPCon bifacial technology. Its products feature SMBB design, minimal LID, strong PID and low light performance with improved degradation – factors that translate into higher efficiency, better yields, improved returns on investment, and shorter payback periods for customers.
Stock Performance:
With a market cap of Rs. 2,255 crores, shares of Indosolar Limited closed in the green at Rs. 542 on Monday, up by around 4 percent, as against its previous closing price of Rs. 521.7 on BSE.
Shares of Indosolar were originally listed on BSE and NSE on 29th September 2010, following its IPO that opened on 13th September 2010, and closed on 15th September 2010, at Rs. 29 per share. However, trading in stock was suspended from 27th June 2022, after capital reduction pursuant to an NCLT order.
The last trade price before suspension was Rs. 3.21 on 24th June 2022, with the halt linked to procedural issues and earlier financial stress.Trading in Indosolar resumed on 19th June 2025, following approvals from both the NSE and BSE. The stock reopened for trading at Rs. 165.06.
Key Positives
Promoters: Trading for Indosolar Limited resumed on 19th June 2025 after a three-year suspension, following approvals from both the NSE and BSE. The revival was driven by its acquisition by Waaree Energies through the corporate insolvency resolution process under the Insolvency and Bankruptcy Code.
The resolution plan received approval from the National Company Law Tribunal (NCLT) on 21st April 2022, marking a decisive step in stabilising the company after insolvency proceedings initiated in October 2018 due to prolonged financial losses. Post-acquisition, Indosolar reported a notable financial turnaround, reporting a net profit of Rs. 55 crore in FY25, compared with a loss in FY24.
To comply with minimum public shareholding norms, Waaree Energies later announced an Offer for Sale (OFS) in September 2025 to divest up to 61 lakh shares, or 14.66 percent of Indosolar’s paid-up capital. As a result, Waaree’s stake reduced from 95 percent in June 2025 to 74.93 percent by September 2025, a move that aligns with regulatory requirements rather than signalling any dilution of strategic interest.
Favourable Sector Tailwinds: Indosolar operates in a sector benefiting from strong structural growth. Demand for solar PV modules continues to rise, especially in the residential and rooftop segments, supported by government incentives and increasing focus on clean energy.
While the industry does face challenges such as volatile raw material prices, logistics issues, and evolving policy frameworks, the long-term growth outlook remains intact.
Globally, the solar PV module market is estimated at $55.4 billion in 2025 and is projected to grow to $97.56 billion by 2032, implying a CAGR of 8.4 percent. Rooftop solar installations are expected to be a key growth driver, with the segment projected to account for 56.8 percent of the market by end-2025.
In India, the solar PV module market reached $7.94 billion in 2024 and is expected to expand at a 10.6 percent CAGR between 2025 and 2033. Over time, easing costs of inputs such as glass and encapsulants could help offset other cost pressures, supporting margins for manufacturers like Indosolar.
Attractive Valuation: From a valuation perspective, Indosolar appears inexpensive relative to peers. The stock is currently trading at a P/E of around 10, well below the industry average of about 44. This sharp discount suggests that the stock might be undervalued and the market is yet to fully price in the company’s turnaround and sector opportunities, potentially offering valuation comfort for investors willing to absorb near-term volatility.
Key Risks and Areas of Concern
Recent Financial Volatility: In Q2 FY26, the company’s profitability weakened during the quarter, with net profit falling sharply from Rs. 117 crores to Rs. 46 crores, a drop of nearly 61 percent QoQ. The numbers highlight near-term earnings volatility even as the company works through its post-revival phase.
Against this backdrop, the company’s Q3 FY26 financial results will be an important monitor, as they may provide clearer insight into the sustainability of the turnaround and help investors reassess the medium-term outlook.
Input Cost and Supply Chain Risks: The company’s margins remain sensitive to fluctuations in solar cell prices, a key raw material for module manufacturing. Changes in demand dynamics and global supply conditions can lead to sudden cost pressures, directly impacting profitability. In addition, uncertainties around logistics and shipping costs pose ongoing risks, particularly in periods of global supply-chain disruptions.
Policy, Technology, and Competitive Pressures: The solar sector is heavily influenced by government policies, incentives, and renewable energy targets, and any adverse changes could affect demand for PV modules.
At the same time, rapid advancements in solar cell efficiency and module technology require continuous investment and innovation, raising execution risk for manufacturers. Intensifying competition from domestic and global players, along with the emergence of alternative energy technologies, could also put pressure on pricing, margins, and market share.
Broader global economic conditions and geopolitical developments can influence capital spending on renewable energy projects, potentially affecting order flows and growth visibility for solar manufacturers like Indosolar.
Indosolar presents a classic risk–reward situation for investors. On one hand, the company benefits from strong promoter backing post-acquisition, an improving balance sheet, advanced product capabilities, and favourable long-term solar sector tailwinds. Its relatively low valuation also offers comfort compared with industry peers.
On the other hand, recent earnings volatility, sensitivity to raw material costs, policy dependence, and intense competition highlight that the turnaround is still evolving. While the long-term outlook for solar remains promising, Indosolar’s near-term performance will depend on execution consistency and margin stability. Investors may therefore view the stock as a potential long-term opportunity, best approached with patience and a clear understanding of the associated risks.
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