Waaree Energies shares fall 6% after subdued Q1 operating performance; Nomura says 'buy'

Shares of Waaree Energies Ltd. fell as much as 6% on Thursday, July 30 in response to its June quarter results. The numbers were reported after market hours on Wednesday.

For the June quarter, Waaree Energies reported a 79.2% growth in its topline to ₹7,932 crore. The figure though was lower than the CNBC-TV18 poll of ₹8,100 crore.

The group has recognized income in relation to refund or reciprocal duties levied under the IEEPA tarrifs by the US worth ₹349.8 crore as other operating revenue.

Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for the quarter stood at ₹1,440 crore, a growth of 44% from last year's figure of ₹997 crore. The figure though, is below expectations, which stood at ₹1,677 crore.

EBITDA margin for the quarter narrowed by over four percentage points to 18.2% from 22.5% last year.

At the end of the June quarter, order inflows for Waaree stood at ₹16,000 crore. Order book for the company stood at ₹61,500 crore.

The company though, has maintained its operating EBITDA guidance for the full year which has been between ₹7,000 crore to ₹7,700 crore.

Waaree Energies' numbers were weak on a sequential basis as well, with revenue declining 11%, adjusted EBITDA declining 31%, while net profit more than halving, with a 52% drop.

Brokerage firm Nomura though, has maintained its "buy" rating on Waaree Energies with a price target of ₹3,750, which implies an upside potential of 37% from current levels.

The brokerage attributed the adjusted EBITDA miss due to margin headwinds persisting, which also offset its strong execution.

However, Nomura said that the healthy order book that the company has provides ample execution growth visibility.

19 analysts have coverage on Waaree Energies, of which 14 have a "buy" rating, one says "hold", and four others have a "sell" recommendation.

Shares of Waaree Energies are trading 6% lower on Thursday at ₹2,572. The stock is still down 8% so far this year.