Websol FY26: Record Revenue, Net Cash Surplus, and a Clear Technology Pivot

Websol Energy System Limited closed FY26 with its strongest financial performance to date. Revenue from operations rose to INR 1,049 crore, up 82.4% year-on-year, while EBITDA increased to INR 429 crore, up 69.6%. Profit after tax came in at INR 303 crore, up 95.8%. The March quarter stood out even more sharply: Q4FY26 revenue was INR 401 crore, EBITDA INR 146 crore, and PAT INR 125 crore.

The numbers were backed by operating cash generation. Cash flow from operations was INR 255 crore in FY26, and the company reported net debt of negative INR 34 crore. Net worth more than doubled to INR 631 crore. Return ratios also strengthened, with ROCE at 65.7% and ROE at 66.7%.

Operations: Utilisation Improved After Capacity Doubling

The operational backdrop to FY26 was the commissioning of Cell Line 2 in September 2025, doubling solar cell capacity from 600 MW to about 1.2 GW. The company reported solar cell utilisation above 90%, and module utilisation improving to 74% in Q4FY26.

Quarterly production data in the presentation showed cell production rising to 258.4 MW in Q4FY26 with 92% utilisation, and module production at 95.1 MW with 74% utilisation. Management also stated that the second cell line is operating at 85% plus utilisation with average efficiency around 23.35%.

Order visibility remained healthy. The company closed Q4FY26 with an order book of INR 1,161 crore, broadly split between solar cells (40%, INR 466 crore) and solar modules (60%, INR 695 crore). Management indicated confidence that this order book can be executed within one financial year.

Margins: Mix Shift and Input Costs Pressured EBITDA Margin

While absolute EBITDA grew strongly, margin compression was visible over the year. Management attributed this largely to product mix. Module margins are structurally lower than cell margins, and Q4FY26 saw the highest-ever module sales contribution.

In addition to mix, management cited higher silver prices and some softening in selling prices. During the call, the company indicated cell realisations around 13 to 13.5 cents per watt and module realisations around 22 to 22.5 cents per watt peak, noting some softening despite higher silver costs.

The company did not provide segment-level margins for cells versus modules, stating that it reports consolidated margins as it uses captive cells in module manufacturing.

Technology and Capex: TOPCon Upgrade First, Then Phased Scale-Up

A major strategic theme from both the presentation and concall was the shift toward TOPCon. Management said it has already started upgrading one 600 MW Mono PERC cell line to TOPCon, taking total cell capacity from 1.2 GW to 1.35 GW. The company guided capex of INR 250 to 270 crore for this upgrade.

Commercial production is targeted by February 2027, with around two months expected for ramp-up to optimal utilisation. Management estimated the production impact of integration to be about 15 days for the line being upgraded, with the other line continuing operations.

On product performance, management said Mono PERC cell efficiency is around 23.3%, while the upgraded TOPCon line is targeting above 24.5%. They also indicated a shift to larger G12R cell format (182 by 210 mm). This is expected to raise watt peak per cell from around 7.8 to around 9.3, driven by both size and efficiency.

Beyond the brownfield upgrade, the company reiterated its plan for a phased greenfield integrated cell and module facility. In the presentation, the roadmap includes a 2 GW TOPCon integrated line planned for commissioning in 2027 and another 2 GW line in 2028. During the call, management emphasised tighter discipline on sequencing, funding structure, and execution planning before committing to firm timelines, while also indicating a target of June 2027 for the next phase.

A third leg of the strategy is backward integration into ingot and wafer. Management said it has signed an MOU with Linton for equipment and technology support and is in technical discussions and team-building. The stated objective is to be ready ahead of the ALMM List III timeline of June 2028.

Balance Sheet and Governance: Net Cash, But Pledge Overhang Remains

The company highlighted a materially stronger balance sheet in FY26. Net debt was reported at negative INR 34 crore, and debt to equity reduced to 0.19x. The company also noted that CRISIL assigned a BBB+ stable rating during the year.

However, one issue received direct attention on the call: promoter pledge. Management stated that outstanding net debt under the IREDA facility is approximately INR 92 crore and that more than 80% of promoter shares are pledged against it. The company said it is in advanced discussions with IREDA and expects to complete repayment and obtain release of the pledged shares in the next month or two, subject to procedural steps.

Key Takeaways for Investors

FY26 appears to mark a full operational and financial turnaround for Websol, supported by high utilisation, record profitability, and strong operating cash flow. The near-term narrative is driven by execution on three fronts: sustaining high run-rate utilisation, delivering the TOPCon upgrade by February 2027 within the guided capex, and providing clearer milestones for the larger phased integrated expansion.

At the same time, investors will likely track two key risk areas highlighted by management itself: margin volatility driven by silver prices and product pricing, and the pace at which pledged shares are released after IREDA repayment. If the company delivers on these near-term items, it enters FY27 with a strong base and visible demand through its INR 1,161 crore order book.