Inox Wind shares declined nearly 5% to trade around Rs 74 on August 10, 2026, even as brokerage Motilal Oswal reiterated a 'BUY' rating with a target price of Rs 92. The brokerage maintains its positive outlook based on a strong order book of 4.4 GW, despite the company reporting a 34% drop in quarterly profits.
Shares of Inox Wind saw a decline on August 10, 2026, falling nearly 5% to trade around Rs 74 as investors responded to the company's latest quarterly financial results. Despite this negative market reaction, brokerage firm Motilal Oswal has maintained a 'BUY' rating on the stock, setting a target price of Rs 92 per share.
Financial Performance Misses Estimates
The brokerage's recommendation comes after Inox Wind reported its Q1 FY27 results, which fell short of market expectations. The company posted a net profit of Rs 64.1 crore, marking a 34.2% decrease compared to the same period last year. Revenue also saw a slight dip, declining 1.5% year-on-year to Rs 814.1 crore. Furthermore, the company reported an EBITDA margin of 18.7%, which is a contraction from the 22.2% margin recorded in the previous year's corresponding quarter. These figures indicate that the company is currently facing pressure on its operating profitability.
Valuation and Order Book Support
Motilal Oswal’s optimistic target price of Rs 92 is based on a 20x price-to-earnings multiple of its estimated earnings for the 2028 financial year. The brokerage suggests that despite the current financial dip, the company's long-term business potential remains intact. A primary factor supporting this view is the company's robust order book of approximately 4.4 GW. Additionally, the company is progressing toward the potential acquisition of Wind World India, with NCLT approval expected by the second quarter of the 2027 financial year. The firm is also preparing for the installation of its new 4X wind turbine prototype, which is on track for completion in August 2026.
Risks and Monitoring Factors
While the brokerage maintains a positive stance, investors may want to monitor several operational risks. The company has set a target for 75% year-on-year revenue growth in FY27, which requires efficient execution of its existing projects. Any delays in converting the large order book into actual revenue could impact the stock's performance. Additionally, the company is dealing with high working capital requirements, which can strain cash flow. Investors should also watch for trends in raw material costs, such as steel prices, which often impact the margins of wind turbine manufacturers. The company's ability to maintain profitability amid these challenges will be a key factor for market participants to track in the coming quarters.