KPI Green Energy FY26: Scale up, higher profitability, and a push toward annuity-led growth

KPI Green Energy Limited closed FY26 with sharp growth across the P&L, alongside a rapid build-out of its renewable portfolio. Consolidated total income rose to 2,742 crore in FY26 versus 1,755 crore in FY25, a 56% year-on-year increase. EBITDA expanded faster, up 73% to 1,006 crore, while PAT grew 57% to 509 crore.

The March quarter kept the momentum intact. Q4 FY26 total income stood at 810 crore, EBITDA at 305 crore, and PAT at 155 crore. EBITDA margin improved to 38% in Q4 FY26 compared with 29% in Q4 FY25, reflecting a mix effect and execution at scale.

A key structural point from the FY26 presentation is that the revenue base remains heavily tilted toward captive projects. The company disclosed that the Captive Power Producer segment accounted for 91% of FY26 revenue, while the Independent Power Producer segment contributed 9%. Management’s commentary indicates that the next phase of growth is intended to increase the IPP share gradually, given its higher margin profile and lower working-capital intensity.

Portfolio growth: 6.26 GW installed plus upcoming

Operationally, KPI Green reported installed capacity of over 1.62 GW as of March 31, 2026, with work in progress of over 4.64 GW. The installed plus upcoming portfolio reached about 6.26 GW.

Within this, the company reported an IPP portfolio of 2.57 GWp, comprising 0.96 GWp energized and 1.61 GWp under execution. The presentation also stated an estimated unit generation of more than 390 crore kWh annually from the IPP portfolio. Management framed IPP growth as a way to build stable annuity inflows, support post-tax returns through accelerated depreciation, and strengthen long-term earnings visibility.

A core enabler highlighted is resource access. The company disclosed a land bank of 7,210 acres at March 2026 and power evacuation capacity of 3,599 MW, both shown as key value drivers in renewables project development.

Earnings versus funding: margins improve, interest cost rises

FY26 reflected both operating leverage and the cost of rapid scale. Interest cost rose sharply to 182 crore in FY26 from 79 crore in FY25, while depreciation increased to 133 crore from 61 crore. Management attributed the interest rise to higher borrowings and working capital needs, and also noted that FY25 interest looked lower because proceeds from the earlier QIP allowed repayment of loans.

Cash flow data points to the capex cycle. Cash flow from operating activities improved to 424 crore, but investing outflow was 4,071 crore, funded largely by financing inflow of 3,642 crore. This aligns with the balance sheet expansion, where total assets increased to 9,882 crore in FY26 from 4,792 crore in FY25.

On the call, management also discussed inventory build-up. Inventory increased to around 1,400 crore, which management linked to the need to execute a large EPC pipeline on time and to mitigate supply uncertainty for panels and turbines.

Strategy beyond solar EPC: trading, storage, and international expansion

FY26 communication highlighted several growth vectors beyond conventional solar and hybrid execution.

First, KPI Green received inter-state trading license from CERC and intra-state trading license from GERC. Management said this provides access to pan-India exchange and bilateral markets, supports market-linked pricing and portfolio flexibility, and could add new revenue streams through trading and contract structures.

Second, battery energy storage is being positioned as a new vertical, largely through the subsidiary Sun Drops Energia. The company highlighted standalone BESS wins with GUVNL, including 120 MW/240 MWh and 445 MW/890 MWh projects. Management stated that BESS is still in an early stage, often supported by viability gap funding, and margins are expected to be lower than pure IPP.

Sun Drops’ financials were also disclosed on the call: FY26 top line of 586 crore, PBT of 130 crore, and PAT of 97 crore. Management said the DRHP filing and listing are targeted in the current financial year.

Third, KPI’s international narrative includes Botswana, where the presentation stated an MoU with the Government of Botswana targeting nearly 5 GW, with 500 MW planned in phase 1. On the call, management said company formation and regulatory groundwork have progressed and that a step-down subsidiary structure is being used for execution.

Takeaways

KPI Green’s FY26 results show a company scaling rapidly with strong profitability and a larger balance sheet. The key investor variables, based on management commentary, are the pace of IPP commissioning, how quickly higher-margin annuity revenue rises versus interest and depreciation, and whether working-capital intensity moderates as the mix evolves.

Management reiterated a growth commitment of 40% to 50% year on year and indicated more selective bidding to protect margins. With 6.26 GW of installed plus upcoming capacity and a stated push into trading and storage, FY27 is positioned as an execution-heavy year where project energization and cash flow discipline will likely drive investor confidence.