Whalesbook
KPI Green Energy concluded fiscal year 2026 with substantial financial growth, reporting revenue of ₹2,696 crore and EBITDA of ₹958 crore, up 55.3% and 70% respectively. Profit after tax (PAT) also saw a significant increase, rising 49% to ₹476 crore. The company's Captive Power Producer (CPP) division was a key driver, expanding by 61.2% year-on-year.
The company's operational expansion saw 447 megawatts (MW) of new capacity commissioned in the fourth quarter, bringing its total operational capacity to 975 MW. However, a significant 376 MW Independent Power Producer (IPP) project for Gujarat's government utility, GUVNL, is facing delays in power evacuation. This infrastructure bottleneck in Gujarat could affect future generation and revenue from that specific project.
Analysts largely maintain a positive outlook, with a retained 'Buy' rating and a price target of ₹562 per share. This target is based on an 18x multiple of the projected fiscal year 2027 earnings per share of ₹31.2. Investors should be aware of a planned 5% equity dilution from a recent warrant issuance, which could potentially impact future earnings per share growth for existing shareholders.
Looking ahead, KPI Green anticipates its higher-margin IPP business, which typically sees EBITDA margins between 85-90%, will contribute more significantly to earnings. Furthermore, the company's battery energy storage systems (BESS) are expected to be fully operational by FY27 and begin generating revenue from FY28.
The company's market capitalization is currently valued within the ₹8,600-₹9,400 crore range. While analysts have revised FY27 and FY28 estimates upwards, KPI Green operates within a dynamic renewable energy sector. This sector faces ongoing challenges such as grid integration, transmission infrastructure, and managing the intermittency of renewable sources.