ACME Solar's Q3 FY26 Performance: Powering Ahead with Strategic Growth and BESS Expansion

ACME Solar Holdings Limited has delivered a robust performance in Q3 FY26, showcasing significant growth and strategic advancements in India's dynamic renewable energy sector. The company, a leading independent power producer, reported a total revenue of INR 617 crore, marking an impressive 53.9% year-on-year increase. This strong top-line growth was complemented by a substantial rise in EBITDA, which surged by 57.2% to INR 564 crore, resulting in an EBITDA margin of 91.5%. Profit After Tax (PAT) also saw a modest increase of 1.5% to INR 114 crore, reflecting the company's operational efficiency and favorable leverage.

The nine-month period ending December 31, 2025, further underscores this positive trajectory. ACME Solar's total revenue for 9M FY26 reached INR 1,802 crore, a remarkable 74.0% increase year-on-year. EBITDA for the same period grew by 77.6% to INR 1,629 crore, with an EBITDA margin of 90.4%. PAT for 9M FY26 stood at INR 360 crore, a significant 179.3% jump from the previous year. This performance is primarily driven by capacity additions and an improved Capacity Utilization Factor (CUF).

Strategic Expansion and Operational Excellence

ACME Solar's operational highlights reveal a company focused on strategic expansion and efficiency. The company partially commissioned 72 MW out of a 100 MW wind project in Gujarat, bringing its year-to-date commissioned capacity to 422 MW. This keeps them firmly on track to achieve their FY26 commissioning guidance of 450 MW. Power generation increased by 49.0% year-on-year to 1,567 million units in Q3 FY26, with the CUF improving from 22.7% to 24.3%. Plant and grid availability remained consistently high at over 99.5%, indicating robust asset management.

A key strategic initiative is the accelerated commissioning of Battery Energy Storage Systems (BESS). The company plans to commission ~2 GWh of BESS by Q4 FY26, an upgrade from its earlier 1 GWh target, with ~1,150 MWh already delivered. This strategy involves deploying BESS at existing operational sites, leveraging existing transmission infrastructure to save approximately INR 20 lakhs per MW in capex and avoid right-of-way challenges. This approach is expected to generate early cash flows and ensure seamless integration with Firm and Dispatchable Renewable Energy (FDRE) projects under long-term PPAs.

Prudent Financial Management and Future Outlook

ACME Solar has demonstrated prudent financial management, particularly in debt optimization. Through successful refinancing and credit rating upgrades, the weighted average cost of debt for its operational portfolio has been reduced to 8.45% per annum, a decrease of over 100 basis points year-on-year. The overall weighted average cost of debt for all outstanding debt, including under-construction projects, stands at 8.6% p.a. The company has also secured new debt of ~INR 3,500 crore for 450 MW under-construction projects at an average rate of 8.9% p.a. and refinanced a 300 MW project at INR ~1,200 crore at 8.0% p.a.

Procurement for FY27 projects has been strategic and cost-effective. Despite China's announced withdrawal of VAT export rebates for solar products and batteries, ACME Solar has already procured 1.7 GWp of modules and a large amount of BESS for its 1.5 GW planned contracted capacity for FY27. This proactive approach has resulted in ~10% savings in the overall CAPEX from the budgeted cost, with no anticipated impact from the VAT changes.

Looking ahead, ACME Solar aims to build a portfolio of 10 GW generation capacity and 20 GWh BESS capacity by 2030. The company has near-term visibility for signing an additional 770 MW of PPAs and has secured connectivity inventory of ~7.5 GW for upcoming bids. Management's focus on technological advancements, including testing Perovskite technology and implementing robotic installation, positions the company for future efficiency and cost reduction.

Navigating Challenges and Reinforcing Trust

While the quarter was strong, ACME Solar transparently addressed challenges. A one-time curtailment loss of INR 17.5 crore was incurred in the 300 MW Sikar project due to temporary GNA and a non-operational transmission line, though the project is now operating at full capacity. A wind project also experienced delays due to a sand mining ban and extended rains. However, the company highlighted that all its projects are outside the revised Great Indian Bustard (GIB) area, mitigating a significant regulatory risk.

ACME Solar's Q3 FY26 performance underscores its strategic clarity and disciplined execution. With robust financial health, a growing and diversified portfolio, and a proactive approach to technology and risk management, the company is well-positioned to capitalize on India's burgeoning renewable energy market. The management's focus on delivering on its commitments and optimizing operations reinforces investor trust and sets the stage for sustained growth.