Sterling and Wilson Renewable Energy Limited

Technology — Solar · NSE

₹164.50−₹10.46 (−5.98%)

DalalBaazaar Score

47 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Very High

Driven by moderate debt load, negative free cash flow, the company is currently loss-making.

In simple words: The company is currently losing money, but sales are shrinking. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:45 pm

Understanding the Business

Company site ↗

The 60-second version of Sterling and Wilson Renewable Energy Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Sterling and Wilson Renewable Energy Limited provides renewable engineering, procurement, and construction (EPC) services in India, Europe, the Middle East, North Africa, rest of Africa, the United States, Latin America, and Australia.

IndustrySolar

SectorTechnology

Employees1,208

Annual revenue₹7,546 Cr

How does it make money?

Turns over ₹7,546 Cr a year. Of every ₹100 of sales, about ₹-4 reaches shareholders as profit, with ₹7 left at the operating level before interest, tax and depreciation. Each of its 1,208 employees supports ₹6.25 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹6.25 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA CONSULTANCY SERV LT, INFOSYS LIMITED, HCL TECHNOLOGIES LTD, WIPRO LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of -10.5% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE32.0%

What is the outlook?

2 analysts covering the stock expect revenue to grow about 20.4% and earnings to grow about 49.3% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+20.4%

Est. earnings growth+49.3%

Analysts2

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +275% while net margin moved -93% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+275%

Margin effect-93%

DalalBaazaar Score

47/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ No meaningful P/E — the company is lossmaking
✗ P/B of 5.91x is a steep premium to book

Quality vs. Valuation

Company Quality

54/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

34/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

N/A

No P/E — the company is lossmaking

EV/EBITDA

8.9x

PEG

—

What's Good / What's Bad

🟢 What's Going Well3

Margins are improving
EBITDA margin is up from -51.3% to 7.4% over 3 years.
Debt is being paid down
Total debt is down 41% over 3 years.
Return on capital is rising
ROCE has improved from -215.9% to -10.5%.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

5 items require attention · 2 high · 3 watch

🔴Thin interest coverageFinancial
Operating profit covers interest only -0.9x — little room if earnings dip.
🔴The company is lossmakingFinancial
Net profit of -₹309 Cr in the latest reported year.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 2.7x to -0.9x.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹269 Cr in the latest year.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 23% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -51.3% to 7.4%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 41% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.

🔴 Bear CaseWhat could go wrong?

Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 41% a year✓ 55.3% CAGR
Latest reported year was -12.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 5%✓ 7.4%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Debt / EBITDA stays below 2x✗ 2.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4Free cash flow remains positive✗ -₹269 Cr
Profit that never becomes cash eventually stops being profit.
5Interest cover stays above 3x✗ -0.9x
How much operating profit can fall before interest stops being comfortably covered.

Investment Checklist

5 / 12 checks passed

✓ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✗ Revenue growing year-over-year
✗ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

1 good · 3 neutral · 7 weak

Market Cap

₹3,842 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not meaningful

Loss-making

Earnings are negative, so a P/E multiple can't be read here

P/B Ratio

5.91x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹-12.31

Loss-making

Negative earnings per share — the business is losing money

ROE

36.2%

Strong

Strong capital efficiency

ROCE

-10.5%

Weak

Low return on total capital employed

Debt/Equity

1.31x

Moderate

Moderate leverage

Revenue Growth (YoY)

-12.6%

Shrinking

Sales are contracting

Profit Growth (YoY)

-479.9%

Falling

Profits are shrinking

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

-₹26 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

9.1x

ROA

4.2%

Average

Average asset productivity

Operating Margin

3.4%

Weak

Thin margins leave little room for error

Net Margin

2.9%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.13

Adequate

Adequate, but no real cushion

Beta (vs Nifty)

0.82

Market-like

Moves roughly in line with the market

52W Range Position

15%

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

170.8 / 183.9

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

40.6

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹2,013 Cr	₹3,035 Cr	₹6,300 Cr	₹7,546 Cr	+55.3%
EBITDA	-₹1,034 Cr	₹57 Cr	₹290 Cr	₹556 Cr	—
EBITDA Margin	-51.3%	1.9%	4.6%	7.4%	—
PAT (Net Profit)	-₹1,170 Cr	-₹212 Cr	₹81 Cr	-₹309 Cr	—
EPS	₹-61.65	₹-10.4	₹3.49	₹-13.25	—
ROE	—	-21.9%	8.1%	-47.6%	—
ROCE	-215.9%	2.5%	16.1%	-10.5%	—
Total Debt	₹2,030 Cr	₹516 Cr	₹936 Cr	₹1,191 Cr	-16.3%
Free Cash Flow	-₹1,838 Cr	₹537 Cr	₹34 Cr	-₹269 Cr	—

🟢 Revenue has grown at 55.3% a year over 3 years.

🟢 EBITDA has turned positive, from -₹1,034 Cr to ₹556 Cr.

🟢 EBITDA Margin has risen from -51.3% to 7.4% over 3 years (+58.7 pts).

🔴 ROE has fallen from -21.9% to -47.6% over 3 years (-25.8 pts).

🟢 ROCE has risen from -215.9% to -10.5% over 3 years (+205.4 pts).

🟢 Total Debt has shrunk at 16.3% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹5,317 Cr

Total Liabilities

₹4,666 Cr

Cash & Equivalents

₹95 Cr

Operating Cash Flow

-₹257 Cr

Capex

-₹11 Cr

Shareholding (proxy)

Institutional Holding

8.1%

Insider Holding

46.7%

Corporate Actions

Ex-Dividend Date

24 Feb 2020

Analyst Consensus

Recommendations

2 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹220.5

+34.0% vs CMP

Target Range

₹220 – ₹221

Peer Comparison

Company	P/E	ROE
TATA CONSULTANCY SERV LT	17.3x	45.6%
INFOSYS LIMITED	15.8x	32.0%
HCL TECHNOLOGIES LTD	20.4x	24.6%
WIPRO LTD	14.5x	15.9%

Recent News

3 mixed3 general

Sterling & Wilson Renewable Energy Q1FY27 PAT rises 36% on lower taxes

scanx.trade, 18 Oct

Sterling and Wilson Renewable Energy (NSEI:SWSOLAR) Stock Forecast & Analyst Predictions

Simply Wall Street, 16 OctAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Sterling and Wilson Renewable Energy Limited (NSE:SWSOLAR) Consensus Forecasts Have Become A Little Darker Since Its Latest Report

Simply Wall Street, 18 Oct

Sterling and Wilson Renewable Energy shares rally 8% after securing Rs 985 crore domestic and global order

The Economic Times, 22 SeptPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Sterling & Wilson Renewable Energy shares jump 6% on ₹985 crore orders win

Moneycontrol.com, 22 SeptPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Sterling and Wilson Solar Share Price: Buy or Sell

Univest, 03 Sept

Watch Items

Revenue growth is negative (-12.6%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongGrowth · Profitability

MiddlingFinancial Health

WeakBusiness Quality · Valuation · Risk

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 2 high-severity red flags sit above this conclusion and should be read first.

3 of 5 tripwires tripped — Debt / EBITDA stays below 2x; Free cash flow remains positive; Interest cover stays above 3x · see Key things to watch ↑