Sterling and Wilson Renewable Energy Limited: Powering Ahead with Record Q3 FY26 Performance

Sterling and Wilson Renewable Energy Limited (SWREL), a prominent global pure-play end-to-end renewable EPC solutions provider, has reported a robust financial performance for the third quarter of Fiscal Year 2026 (Q3 FY26). The company achieved its highest-ever third-quarter top-line performance since listing, with revenues soaring to INR 2,092 crore. This impressive growth, marking a 14% year-on-year increase, was primarily fueled by an accelerated execution pace in its domestic EPC projects, reflecting strong operational capabilities and improved customer confidence.

For the nine-month period of FY26, SWREL's revenue reached INR 5,602 crore, demonstrating a significant 48% year-on-year growth compared to INR 3,783 crore in 9MFY25. This strong top-line expansion underscores the company's ability to capitalize on the burgeoning renewable energy market, supported by enhanced credit ratings and new credit lines from lenders. Operational EBITDA for the first nine months stood at INR 289 crore, a substantial 115% increase from INR 134 crore in 9MFY25, indicating favorable operational leverage as execution scales up.

Strategic Milestones and Order Book Momentum

SWREL's Q3 FY26 was marked by several strategic milestones that are poised to have a long-term positive impact on its future operations. The company's new order inflow has been exceptionally strong, touching INR 6,929 crore during 9MFY26. This robust ordering momentum led management to revise its new order inflow guidance for Fiscal Year 2026 to over INR 11,000 crore, projecting more than 60% year-on-year growth and positioning FY26 as one of the most successful years for order bookings.

In Q3 FY26 alone, SWREL secured INR 3,086 crore in new orders through four key project wins. A significant highlight was a gigawatt-scale Balance of System (BOS) order from Adani Green for three solar power projects at the Khavda Renewables Energy Park in Gujarat, valued at approximately INR 1,381 crore. This order was complemented by a multi-year strategic partnership framework agreement with Adani Green Energy Limited, signaling a deeper engagement and a strong endorsement of SWREL's execution capabilities. This partnership is expected to provide stable and repeatable EPC orders annually, aligning with India's large-format renewable energy development needs.

On the domestic front, the company also secured two more key project wins, including a 210 MW project from a private Independent Power Producer (IPP) and a large 790 MW-hour Battery Energy Storage System (BESS) project from Serentica. This BESS win, following the JSW BESS order, firmly establishes SWREL's credentials in the rapidly growing energy storage market.

Internationally, SWREL continues to make strong inroads, securing its second South African order worth USD 147 million (approximately INR 1,220 crore) for a 240 MW turnkey project. This marks the fourth project in South Africa, with management noting that post-COVID international projects are progressing as expected, adhering to terms and profitability targets.

Operational Efficiency and Market Outlook

SWREL's unexecuted order value (UOV) currently stands at INR 10,413 crore, up from INR 9,096 crore as of March 2025, providing robust revenue visibility. Approximately 75% of the current order book comprises domestic Indian projects, with international UOV primarily consisting of projects in Europe and South Africa. The company's operations and maintenance (O&M) business continues to be a steady annuity stream, having crossed the 10-gigawatt portfolio mark. This segment is expected to contribute significantly to revenue stability and margin resilience as more large projects transition from construction to operation.

Gross margins for 9MFY26 stood at 10%, consistent with FY25. Q3 FY26 gross margin improved sequentially to 9.5% from 8.9% in Q2 FY26 and also improved from 9.4% in Q3 FY25. Operational EBITDA for Q3 FY26 was INR 105 crore, up from INR 90 crore in Q3 FY25 and INR 62 crore in Q2 FY26. Recurring overheads remained flat at around INR 93 crore. However, the reported Profit After Tax (PAT) for Q3 FY26 was INR 2 crore, impacted by an exceptional cost of approximately INR 31 crore due to a final arbitration ruling in a US subcontractor case, which was not covered by indemnity.

The balance sheet remains stable, with net debt decreasing by INR 4 crore to INR 738 crore compared to the previous quarter. Net working capital improved to negative INR 407 crore, continuing to operate in a negative cycle. The company successfully retained its BBB+ credit rating from Infomerics Ratings and raised fresh funds totaling INR 2,500 crore since the start of the fiscal year.

Looking ahead, the industry outlook for India's renewable energy sector remains fundamentally constructive. Management anticipates 6-7 gigawatts of orders to be bid out in India in Q4 FY26 alone. The FY27 third-party EPC pipeline is expected to surpass 30 gigawatts. India's BESS capacity requirements are projected to reach 34.7 gigawatts by the end of FY27, presenting a significant opportunity for SWREL. The company is strategically engaging in multi-year capacity rollouts with repeatable scopes, standardized engineering, and tight integration, which structurally benefits experienced EPC players like SWREL.

Concluding Thoughts: Sustained Growth and Strategic Clarity

SWREL's Q3 FY26 performance reflects a period of sustained growth and strategic clarity. Despite navigating one-off legal expenses and temporary dips in O&M margins, the company's core business drivers remain robust. The record order inflows, strategic partnership with Adani Green, and strong positioning in the BESS market underscore its potential for continued expansion. With a disciplined approach to project selection and a focus on operational excellence, Sterling and Wilson Renewable Energy Limited is well-equipped to capitalize on the accelerating transition to renewables, reinforcing investor confidence in its long-term trajectory.