Zodiac Energy Q1 FY27: Growth in EPC, early steps in storage and IPP

/n/n# Zodiac Energy Q1 FY27: Growth in EPC, early steps in storage and IPP/n/nZodiac Energy Limited reported a strong start to FY27, with Q1 FY27 revenue from operations of 141.8 crore, up 45 percent year on year. Operating performance improved as well, with EBITDA at 15.1 crore, up 55 percent, and an EBITDA margin of 10.6 percent. Profit after tax rose to 7.0 crore from 2.7 crore in Q1 FY26, taking the quarter’s PAT margin to 5.0 percent./n/nThe quarter’s headline numbers reflect an EPC-led scale-up, supported by a larger ground-mounted contribution and a continued effort to build longer-duration earnings through an independent power producer portfolio. At the same time, the presentation signals that the company’s next phase of growth is expected to be shaped by battery energy storage system execution through its distributed energy platform approach, and by export-led expansion in Africa and the MENA region./n/n## Q1 FY27 performance: revenue scale-up with improving operating margin/n/nZodiac Energy’s revenue growth in Q1 FY27 was accompanied by better operating leverage. Total operating expenses rose from 7.4 crore to 9.8 crore, and employee costs increased to 3.5 crore, but EBITDA expanded faster than revenue./n/nBelow the EBITDA line, the presentation shows a sharp improvement in profit before tax to 9.6 crore. Other income increased to 1.5 crore, while finance costs in the quarter increased slightly to 4.6 crore. Depreciation rose to 2.3 crore, consistent with the company’s larger asset base in FY26./n/nThe quarterly improvement sits within a broader FY24 to FY26 scaling story. Revenue from operations increased from 220 crore in FY24 to 544 crore in FY26, while EBITDA increased from 19 crore to 55 crore and EBITDA margin improved from 8.6 percent to 10.2 percent. Net profit growth has been more modest at the full-year level, with PAT moving from 20 crore in FY25 to 21 crore in FY26, and PAT margin declining to 3.9 percent in FY26./n/n| Metric | Q1 FY26 | Q1 FY27 | YoY change | FY25 | FY26 | YoY change |/n|---|---:|---:|---:|---:|---:|---:|/n| Revenue from operations (crore) | 98.1 | 141.8 | 45% | 407.8 | 543.5 | 33% |/n| EBITDA (crore) | 9.7 | 15.1 | 55% | 37.0 | 55.3 | 50% |/n| EBITDA margin | 9.9% | 10.6% | 0.7 pp | 9.1% | 10.2% | 1.14 pp |/n| Profit after tax (crore) | 2.7 | 7.0 | 157% | 20.0 | 21.0 | 5% |/n| EPS (rupees) | 1.8 | 4.6 | 158% | 13.4 | 13.9 | 4% |/n/n## Segment mix: ground-mounted EPC drives the quarter/n/nThe company’s disclosed segment data shows that ground-mounted solar remains the largest contributor. In Q1 FY27, the ground-mounted solar business delivered revenue of 78.9 crore and represented 56 percent of consolidated revenue. This segment expanded versus Q1 FY26, where revenue was 49.7 crore and the share of consolidated revenue was shown as 51 percent./n/nRooftop solar remains a smaller portion of the current mix. Q1 FY27 rooftop revenue was 3.2 crore compared to 2.9 crore in Q1 FY26. On an annual basis, rooftop revenue was 22.0 crore in FY26, compared to 15.8 crore in FY25 and 20.0 crore in FY24. The presentation frames the rooftop approach as selective, focusing on customers that value quality, assurance, and service rather than competing primarily on price./n/nThe company positions itself as an end-to-end execution partner with four verticals: EPC ground-mounted solar, EPC rooftop solar, IPP and distribution of solar products. It also highlights an increasing focus on emerging technologies including building integrated photovoltaics, energy storage, and hybrid systems./n/n## Strategy: storage and IPP as the next legs of the model/n/nA central strategic theme in the presentation is that the next stage of the renewable transition will demand flexibility, not only generation. Zodiac Energy states that it is executing battery energy storage system projects and positioning ahead of storage tailwinds. It also outlines a distributed energy platform concept through mobile battery energy storage systems aimed at diesel replacement, targeting temporary and critical power needs in construction, events and infrastructure, and commercial facilities./n/nThe model described includes a managed clean power approach with remote monitoring and system management. Importantly, the presentation includes an execution marker: a local assembly facility is planned within 6 to 12 months, positioned as a lever for cost efficiency, faster deployments and customization. While the presentation does not quantify capex, the stated assembly timeline gives investors a tangible milestone to track./n/nOn the independent power producer side, Zodiac Energy provides detailed FY26 operating metrics. The IPP portfolio generated revenue of 15.6 crore in FY26, produced 65.7 million units, completed 12 projects, and reached 44.5 megawatt-peak of installed capacity. The company describes the IPP portfolio as an annuity-style earnings base and states that it is prioritizing projects with strong internal rates of return. Management also highlights IPP portfolio revenue scaling up to 5.0 crores as a long-term growth driver, though a quarter-wise split is not provided./n/nManagement guidance in the presentation includes a stated 1,000 crore revenue target by FY29, linked to a Zenwatt-led expansion theme. The presentation also reiterates intentions to scale the ground-mounted business, selectively deepen rooftop presence, and reinforce an export-oriented EPC position through Africa expansion./n/n## Balance sheet and cash efficiency: scale comes with leverage/n/nThe balance sheet summary shows a materially larger asset base in FY26 compared to FY25, reflecting growth across working capital and fixed assets. Total assets increased to 482.4 crore in FY26 from 302.4 crore in FY25. Property, plant and equipment rose to 118.0 crore from 75.7 crore, while inventories increased sharply to 128.5 crore from 51.5 crore. Trade receivables also increased to 113.1 crore from 57.1 crore./n/nThe liabilities side indicates higher funding requirements alongside this growth. Total liabilities increased to 363.8 crore in FY26 from 205.8 crore in FY25. Current borrowings rose to 121.9 crore from 64.3 crore, and non-current borrowings increased to 107.1 crore from 93.2 crore. Net debt to equity is shown at 1.9x in FY26 compared to 1.8x in FY25 and 0.8x in FY24./n/nThe cost of carrying this balance sheet expansion is visible in the income statement. Finance costs increased to 19.3 crore in FY26 from 8.7 crore in FY25. Depreciation also rose to 10.0 crore in FY26 from 2.7 crore in FY25, consistent with the higher asset base./n/nWorking capital metrics show mixed movement. Debtor days improved to 57 days in FY26 from 61 days in FY25 and 106 days in FY24, indicating better collections. However, the cash conversion cycle increased to 94 days in FY26 from 83 days in FY25, suggesting that overall working capital duration was still elevated as the business scaled./n/n## Market backdrop: India’s solar buildout remains the long runway/n/nThe presentation anchors the company’s opportunity in India’s solar capacity expansion. It cites PV solar installed capacity rising from 54.0 gigawatts in 2022 to 143.6 gigawatts in 2026, supported by policy push, cost reductions and infrastructure expansion. It also outlines demand drivers such as electrification of the economy, climate commitments, and deployment of hybrid and round-the-clock renewable offerings enabled by storage./n/nFor Zodiac Energy, this market context matters because the company has historically grown installations meaningfully. Its five-year solar installation track record increased from 14.1 megawatts in FY22 to 99.7 megawatts in FY26. The presentation also highlights geographic expansion. In India, it states presence across 15 plus states and union territories with 500 plus commercial and industrial projects executed and 110 plus under execution. Internationally, it discloses presence in Zambia with 2 commercial and industrial projects executed and 1 under execution, and references commissioning of its first hybrid renewable solution in Africa./n/n## What to track next/n/nZodiac Energy’s Q1 FY27 update shows an EPC-led growth engine that continues to scale, with ground-mounted solar as the dominant contributor. The company is also trying to shape a second act by building an IPP annuity base and pushing into storage through a mobile battery energy storage system model with a stated plan for local assembly within 6 to 12 months./n/nThe key investor trade-off is visible in the numbers. Growth has been accompanied by higher leverage and sharply higher finance costs in FY26, while return ratios have moderated. Over the next few quarters, the most useful signals will be whether working capital stays controlled as execution scales, whether storage initiatives convert into measurable revenue and margins, and whether the company can balance expansion with disciplined capital efficiency./n