Sterling and Wilson Renewable Energy Secures INR 1,470 Crore Green Energy Projects in Rajasthan and Gujarat

Sterling and Wilson Renewable Energy Ltd. (SWREL) has declared a momentous amplification to its project portfolio, obtaining three new green energy projects to the tune of INR 1,470 crore. This intensification includes the company’s first wind-solar hybrid engineering, procurement, and construction (EPC) project—an entry into the wind energy segment and, fingers crossed, a harbinger of future expansion into this fast-growing sector.

Expansion into Wind Energy

The company received a mandate for a wind-solar hybrid project in Rajasthan that has capacities of 69.3 MW (wind) and 75 MW (solar). It is the lowest bidder for a 260 MW turnkey solar project in Gujarat. The third project is a photovoltaic (PV) plant in Rajasthan. All three renewable energy projects reinforce the company's strong presence in India's renewable energy market.

SWREL’s hybrid project in Rajasthan signals its initiation into wind EPC. The project comprises Balance of Plant (BoP) services for 127 MW AC of solar and wind energy working in unison. The breakdown is as follows: 1) BoP for 69.3 MW wind energy, 2) 58 MW AC (75 MW DC) solar plant BoS, and 3) a 132 kV/33 kV pooling substation. With this project, the company begins integrating wind energy solutions into its existing solar and battery energy storage system (BESS) lineup and effectively provides an EPC portfolio in which wind, solar, and storage work harmoniously. It is a step toward offering more comprehensive energy solutions.

Market Response and Financial Performance

After the announcement, the stock price of SWREL on the National Stock Exchange (NSE) shot up by 6.33%, coming to rest at a close of INR 266.20 per share. Given that the broader Nifty index was down 1.5% on the same day, this uptick in SWREL's stock was quite counter-trend. But, even with this uptick, it's worth noting that this stock has really struggled over the past year, showing a 50.70% decline.

Sterling and Wilson Renewable Energy returned to profitability in the October-December quarter, posting a net profit of 14.8 crore rupees ($1.8 million) compared with a loss of 63.7 crore rupees a year ago. The company reported nearly three times the revenue, at 1,837 crore rupees, from 583 crore rupees a year ago. EBITDA rose to 70.5 crore rupees in the latest quarter from 16 crore rupees. The company also managed to improve its EBITDA margin slightly, though it remains low, at 3.8 percent.

Sterling and Wilson Renewable Energy's expansion into wind EPC corresponds with India's overall shift to toward renewable energy. The country is hewing toward an international electricity market it can use to fulfill ambitious energy sustainability target laws like the Electricity Amendment Bill. SWREL's success in securing large project contracts indicates strong market confidence in the outfit's overall competence.