Why Borosil Renewables Share Price is Rising

India's financial markets were on tenterhooks awaiting the Union Budget.

Investors were keen to understand the government's allocation for renewable energy, potential policy changes, and incentives, making renewable energy stocks a hot topic in the run-up to the budget.

Now that the budget unveiled, its impact is reverberating across sectors, particularly in the renewable energy space. Solar stocks, in specific, are basking in the afterglow of the budget announcements.

Among the solar power players, Borosil Renewables, a leading manufacturer of solar glass and value-added solar products, has been a standout performer.

The company's stock price surged by 6.7% today following Finance Minister Nirmala Sitharaman's budget speech.

Let's delve into the specifics of what triggered this rally.

#1 Government to Release Energy Transition Policy

Solar stocks surged today after Finance Minister Nirmala Sitharaman's Budget speech.

She announced that the PM Surya Ghar Muft Bijli Yojana had 12.8 million (m) registrations and 1.4 m applications. She stated that the government's focus was on energy security.

She announced that a policy document on energy transition pathways would be released. The PM Surya Ghar Muft Bijli Yojana was launched by the Modi 2.0 government. This scheme aims to install rooftop solar plants. It provides free electricity up to 300 units per month to 10 m households.

Sitharaman mentioned that this scheme would further encourage households to obtain free electricity up to 300 units.

This benefits Borosil Renewables by driving demand for solar panels. As more households install rooftop solar plants, the need for reliable solar solutions increases.

The company is a key player in this sector, stands to gain from the growing market. The scheme's success will lead to higher sales and potential growth for the company.

#2 Fund Raising Initiative

On 25 June 2024 the company announced issue of a Qualified Institutional Placement (QIP) at a floor price of Rs 331.8 per share.

The company aimed to raise up to Rs 2.5 billion (bn) through this route.

However, the QIP raised Rs 1.5 bn. The management stated that these funds would be used primarily to repay existing debt.

The company maintains a low debt level as part of its conservative financial strategy, and this move aligned with its goal of reducing debt on its books.

Additionally, India's first solar glass manufacturer, announced on 7 June 2024 that its board approved raising up to Rs 4.5 bn through a rights issue of shares.

Fundraising through QIP and rights issues can boost a company's share price by improving its financial health.

Reducing debt strengthens the balance sheet, making the company more attractive to investors. These steps indicate strong financial management and a strategic focus on growth.

What Next?

The Indian solar industry is experiencing positive momentum. Solar installations have grown significantly, with 15 gigawatts installed last year. It is significantly higher from 12.8 gigawatts the previous year.

The government has mandated the use of only ALMM-certified modules in new projects. This regulation boosts domestic module manufacturing and, consequently, the demand for solar glass.

Borosil Renewables is strategically positioned to capitalise on this demand. The company has already set up a batch house for 2,000 tonnes. This reduces future capital expenditures for expansion.

The electrical infrastructure is also in place, allowing for rapid scaling up of production when opportunities arise. Additionally, it has the necessary land and detailed plans ready, ensuring that the company can start new projects quickly.

The company plans to significantly increase its production capacity. If the Indian government imposes an anti-dumping duty, it could potentially double its capacity within 24 months.

Past projects have been completed even faster, sometimes within 14 months. This swift capacity expansion will help the company meet the growing demand for solar glass both domestically and internationally.

The domestic solar glass manufacturing capacity has already reached 2,300 tons per day, with Borosil Renewables being the largest non-Chinese owned producer globally.

The government's target to install rooftop solar systems on 10 million houses under the Pradhan Mantri Suryodaya Yojana will further boost demand.

Overall, Borosil Renewables is well-prepared to take advantage of these sectoral tailwinds and growth opportunities. With robust infrastructure and strategic planning, the company is poised for significant expansion and increased market share in the solar glass industry.

How Borosil Renewables Share Price has Performed Recently

In the past five days, Borosil Renewables share price has rallied 1.4%. In the last month, it is up 1.7%.

In 2024, so far its share price has surged 17.7%. Additionally, it is up 4.4% in the last one year.

The stock touched its 52-week high of Rs 667.4 on 1 February 2024 and a 52-week low of Rs 391.6 on 26 October 2023.

About Borosil Renewables

Borosil Renewables is the first and only solar glass manufacturer in India.

A part of the Borosil group which is well-known for the brand "BOROSIL" the company manufactures a range of lab ware, scientific ware, and consumer ware products.

The present solar glass manufacturing capacity is 450 TPD (equivalent to solar glass for 2.8 GW of solar modules).

Recently Borosil Renewables acquired Interfloat group, the largest solar manufacturer in Europe having a capacity of 300 TPD (equivalent to solar glass for 2 GW of solar modules).

The company won a National Award 2021 from the department of science and technology, for the successful commercialisation of indigenous technology.

Borosil Renewables is known for the pioneering achievements like - the development of the world's first fully tempered solar glass in 2 mm thickness, solar glass with the lowest iron content giving the highest glass efficiency, and world's first antimony-free solar glass.

For more details about the company, you can have a look at Borosil Renewables factsheet and quarterly results on our website.

And to know what's moving the Indian stock markets today, check out the most recent share market updates here.

Happy Investing.

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