ACME Solar Share Price Target: Brokerage firm Investec has initiated coverage on ACME Solar with a 'Buy' rating and a price target of Rs 319.
ACME Solar share price target implies a potential upside of about 26 per cent from current levels.
ACME Solar share price closed 6 per cent higher at Rs 269.30 on BSE during Friday's trading session (March 27).
Investec has valued ACME Solar at 9x FY28E EV/EBITDA versus its peers like JSW Energy, Tata Power and NTPC Green. JSW Energy, Tata Power and NTPC Green are currently trading at 12-14x.
Despite the lower multiple, ACME Solar's superior return and margin profile, driven by its integrated business model, higher FDRE share, and strong project visibility, provide earnings visibility.
ACME Solar (ACME) is in the middle of a structural step change. The company is evolving from a mid-sized solar developer into India’s leading Firm and Dispatchable Renewable Energy (FDRE) player, powered by solar-wind-storage hybrid solutions that deliver round-the-clock clean power.
The investment case rests on four pillars:
1. Strong FDRE positioning (49 per cent of portfolio)
2. Improving returns through timely execution (ROCE 12–13 per cent)
3. 63 per cent EBITDA CAGR over FY25–28E driven by a robust pipeline
4. Attractive valuation at 8x FY28E EV/EBITDA, the lowest among peers
Investec said that ACME Solar's 5.1GW under construction pipeline gives it a multi-year growth visibility, scaling installed capacity to 6GW by FY28 and 8GW by FY30E.
Crucially, most projects are awarded by central nodal agencies such as SECI, NTPC, NHPC, and SJVN, ensuring low counterparty risk.
Investec said that ACME’s revenue, EBITDA and PAT will grow at 62 per cent, 63 per cent and 69 per cent CAGR to Rs 59 billion, Rs 53 billion and Rs 12 billion, respectively. It said that ACME's EBITDA margins will expand to 89.5 per cent by FY28E vs 87.9 per cent in FY25 on higher execution of high-margin FDRE projects.
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