Crisil Ratings upgrades LT ratings of Premier Energies to 'A+' with 'positive' outlook
The rating on the short-term facilities has been reaffirmed at ?Crisil A1?.
Crisil Ratings stated that the upgrade factors in the higher-than-expected improvement in the operating performance in fiscal 2026, driven by higher revenue growth, healthy utilisation of its manufacturing capacity, and strong operating profitability.
This growth is likely to sustain over the medium term. The upgrade also factors in sustenance of strong financial risk profile over the medium term.
The continuation of the outlook factors that the business risk profile of the company may improve with commissioning and stabilisation of the 7 giga-watt (GW) Topcon cell manufacturing capacity in fiscal 2027, taking the total cell capacity to 10.6 GW and balancing it with the module manufacturing capacity of 11 GW. This will help the group meet the domestic content requirement (DCR) demand as per guidelines for the approved list of cell manufacturers (ALCM).
Operating income rose 20% in fiscal 2026 to reach Rs 7,824 crore, led by ramp-up of 5.6 GW Topcon module capacity commissioned in March 2026, and is likely to grow further over the medium term, post commissioning and ramp-up of the 7 GW Topcon cell capacity in fiscal 2027 and orders worth ~Rs 14,010 crore as on March 31, 2026.
Operating income will also be supported by the recently completed acquisition of Transcon Ind (manufacturer of transformers) and implementation of the battery energy storage system (BESS) capacity of around 12 GW hours (GWh) in two phases (over fiscals 2028 and 2029).
Capacity utilisation has been healthy, with effective average utilisation of 85% for cells and 77% for modules in fiscal 2026 and should sustain with higher DCR in solar modules over the medium term. Operating margin stood at 30.4% and 27.3% in fiscals 2026 and 2025, respectively, and likely to sustain over the medium term.
The financial risk profile is strong, as reflected in net debt to Ebitda and interest coverage ratios of around 0.4 time and 16 times, respectively, as on 31 March 2026.
The ratings reflect the group?s established market position in the domestic solar cell and module manufacturing industry, backed by its highly integrated facilities, extensive experience of the promoter, and robust demand, supported by the government?s thrust on capacity addition and favourable policies in the form of Approved List of Models and Manufacturers (ALMM) and basic customs duty (BCD).
However, susceptibility to intense competition, regulatory changes, volatility in raw material prices and timely stabilisation of new capacities will remain monitorable over the medium term.
Premier Energies has one of the largest integrated (solar cell and module) manufacturing facilities (capacity-wise) in India.
The scrip rose 0.35% to currently trade at Rs 1019.65 on the BSE.
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