The expanded ALMM framework is expected to reshape the competitive landscape. India’s module manufacturing segment has remained fragmented, characterised by several small-scale players competing on price. However, the inclusion of cells and now wafers effectively mandates backward integration, raising entry barriers and accelerating consolidation. Larger players with the ability to invest across the value chain, from ingots to wafers, cells and modules, are likely to gain a decisive advantage.From a margin perspective, integrated manufacturing offers better cost control, improved supply chain visibility and reduced dependence on imports. This is particularly relevant in a global environment marked by supply disruptions and pricing volatility in upstream components. Companies that successfully execute on integration are expected to benefit from higher margins and more stable revenue streams.
At the same time, the policy includes targeted exemptions to ensure a smooth transition. Projects nearing bid submission timelines, those already exempt under earlier ALMM provisions, and certain open-access or net-metering installations commissioned before the enforcement date will not be immediately impacted. This calibrated approach balances industry growth with policy intent.
Looking ahead, the sector’s medium-term outlook remains constructive, underpinned by strong policy support and a clear push towards self-reliance.
The transition towards an end-to-end domestic manufacturing ecosystem is likely to drive capacity additions, enhance competitiveness, and position India as a credible global manufacturing hub in solar.However, execution timelines, capital intensity and the pace of capacity ramp-up will remain key monitorables as the industry navigates this next phase of evolution.
Waaree Energies: Buy | Target Rs 3514
Waaree Energies benefits from its strong position in domestic and international solar module and cell manufacturing, operational efficiency gains, and a favourable product mix.Rising share of DCR modules and enhanced competitiveness versus Chinese imports support sustainable long-term growth and structural advantage. 3QFY26 results surpassed expectations, with revenue of Rs 75.7 billion (+16% vs estimate) and EBITDA up 26% on a 25% margin. Module and cell production grew 34% and 35% QoQ, respectively.
Higher realisations, improved utilisation and cost absorption measures mitigated the limited impact of silver price volatility. Looking forward, WEL is set to exceed FY26 EBITDA guidance of Rs 55–60 billion.
Margins are expected to moderate gradually to ~20.5% by FY28, while strong global pricing, ramped-up production and project execution support growth.
Premier Energies: Buy | Target Rs 1000
Premier Energies (PEL) is a strong play on India’s solar scale-up, underpinned by the government’s focus on maximising power generation from renewable energy sources and indigenising power generation by mandating local manufacturing of solar modules and cells.
PEL stands out due to its strong capacity ramp-up, industry-leading backward integration and robust order book. Its module and cell capacities are set to scale to 11.1 GW by FY26 and 10.6 GW by FY27, while a superior cell-to-module integration ratio of ~67%, well ahead of peers, enables healthy EBITDA margins.
(The author Siddhartha Khemka is Head of Research – Wealth Management at Motilal Oswal Financial Services)
(Disclaimer: Recommendations, suggestions, views and opinions given by experts are their own. These do not represent the views of The Economic Times.)