Financial Performance Highlights

Q2 FY27 (Quarter Ended September 30, 2026) Standalone Results:

  • Revenue from operations: INR 1,307 crores, up 130% YoY
  • EBITDA: INR 223 crores, up 116% YoY
  • EBITDA Margin: 17.1% (vs. 18.1% in Q2 FY26)
  • Profit After Tax: INR 133 crores, up 111% YoY
  • PAT Margin: 10.2% (vs. 11.1% in Q2 FY26)

H1 FY27 (Half Year Ended September 30, 2026) Standalone Results:

  • Revenue: INR 2,652 crores, up 127% YoY (nearly matches full FY26 revenue of INR 2,655 crores)
  • EBITDA: INR 478 crores, up 128% YoY
  • EBITDA Margin: 18.0% (vs. 17.9% in H1 FY26)
  • Reported PAT: INR 191 crores (includes exceptional loss of INR 143 crores pre-tax from Bawal fire)
  • Normalized PAT (excluding exceptional): INR 298 crores, up 128% YoY
  • Normalized PAT Margin: 11.2%

Strategic Business Overview

Management emphasized that Fujiyama is not a pure solar module manufacturer but a consumer company in household energy, with over 85% of revenue coming from retail households and small businesses purchasing through dealers. The company is built exclusively around rooftop solar solutions for retail customers and manufactures every core component: solar cells, solar panels, inverters, and batteries across on-grid, off-grid, and hybrid systems.

Five Strategic Moats Highlighted

1. Distribution and Deep Retail Reach: Over 10,200 channel partners, distributors, dealers, and exclusive UTL shoppes across more than 25 states/UTs. Added 100+ distributors and 1,000+ dealers in H1 FY27. Odisha and Uttarakhand moved to "fully covered" category.

2. Service and R&D Feedback Loop: Over 1,000 on-roll service engineers (up from ~650 in March 2026), all company employees. Supports dealers with installation and service. Complaint logs feed into 80+ R&D engineers, leading to patented technologies like rMPPT hybrid inverter.

3. UTL AI Technology Platform: In-house built platform running sales, service, and dealer network through WhatsApp/voice chatbots in local languages 24/7. Predicts spare part needs, guides service routes, and identifies expansion areas.

4. Backward Integration and Regulatory Compliance: Manufacturing capacity includes 1 GW solar cells, 3.5 GW solar panels, 4 GW power electronics, and 545 MWh lithium-ion batteries. Increased stake in Zayo Energy and Zayo Cables to 50% (plan to make frames, ribbons, junction boxes, cables, EVA sheets). Full compliance with MNRE data sovereignty requirements (servers and data in India) and CEA cybersecurity regulations.

5. Brand Equity and Dual Brand Strategy: Surya Kumar Yadav represents Fujiyama Solar; Anil Kapoor represents UTL Solar. Panels carry 25-year performance warranty; on-grid inverters carry up to 10-year product warranty.

Capacity Expansion Update

  • August 2026: Commissioned 2 GW power electronics facility at Ratlam (already has solar panels since May 2026)
  • Upcoming: Lithium-ion battery at Ratlam upsized from 2 GWh to 3 GWh (expected next quarter) - total li-ion capacity to reach 3.5 GWh
  • Upcoming: Tubular batteries at Hathras, UP (1 GW plant replacing Bawal capacity lost in fire) - expected next quarter
  • Upcoming: TOPCon solar cells at Ratlam (1.2 GW on track for Q1 FY28) - total cell capacity to reach 2.2 GW
  • Evaluating: Ingot wafers ahead of ALMM List-III (June 2028), sodium-ion/advanced chemistry batteries
  • Pilot: 5 MW BESS at Dadri; planned 10 MW installation at Ratlam

Margin and Inventory Explanation

Margin Dip (17.1% in Q2 vs 18.9% in Q1):

  • Gross margin similar in both quarters
  • Seasonal softness in rooftop solar industry
  • Ratlam facility overheads before full volume arrival (fixed costs spread over larger revenue base as facility ramps up)
  • Increased selling and distribution overheads for expansion into new states
  • Two temporary factors: (1) Buying tubular batteries from outside suppliers post-Bawal fire (lower margin) until Hathras starts; (2) Front-loaded expansion in sales, marketing, and service footprint
  • Inflation was higher due to geopolitical situation but normalizing now

Inventory Increase (INR 1,230 crores in Sept vs INR 910 crores in March):

  • Business doubled in same period
  • Inventory days improved to 99 days from 123 days (measured against COGS)
  • Net working capital days improved to 59 from 83
  • Receivable days at just 10 days
  • Inventory buildup is normal and deliberate for: (1) Positioning for domestic cell switch (ALMM List-II mandate from January 1, 2027); (2) New product lines from Ratlam requiring initial raw material buildup

Balance Sheet and Cash Flow

  • Total assets: INR 2,907 crores (vs INR 2,344 crores in March 2026)
  • Total equity: INR 1,466 crores (vs INR 1,273 crores)
  • Total debt: INR 851 crores
  • Cash & equivalents: INR 52 crores
  • Net debt: INR 800 crores
  • Net debt-to-equity: 0.55x
  • Increase in net debt to finance working capital and Ratlam capex
  • Operating cash flow before working capital changes: ~INR 490 crores in H1
  • Working capital investment: INR 661 crores to support doubled business size
  • Investing activities: INR 184 crores

Bawal Fire Insurance Claim

  • Exceptional loss of INR 143 crores pre-tax (INR 107 crores post-tax) recognized in Q1
  • Insurance claim filed for full carrying value of damaged assets
  • Salvage disposal completed
  • Expect resolution and realization of insurance claim in FY27, providing additional working capital cash inflow

Market Outlook and Demand Drivers

  • PM Surya Ghar Muft Bijli Yojana: Covered 60+ lakh households, installed 19+ GW, released INR 36,000+ crores subsidy as of October 31, 2026
  • About 5 lakh households remain to be covered in current phase (until March 2027)
  • PM Surya Ghar 2.0 under government consideration (may include battery storage support, generation-linked incentives, shared rooftop solar)
  • Business doesn't depend totally on subsidy - built off-grid business over decades without subsidies
  • Electricity tariffs rising in several states (MP, Jharkhand, Chhattisgarh)
  • Household consumption growing with ACs and appliances
  • Backup necessity in Tier 2/3 towns with unreliable supply
  • India rooftop solar capacity: ~26 GW in March 2026 vs estimated potential of 67 GW (<5% penetration)

Q&A Session Highlights

  • Management declined to provide updated revenue guidance for H2 FY27, preferring to wait for Q3 results clarity on ALMM List-II implementation and PM Surya Ghar 2.0
  • Margin guidance maintained at sustainable levels (previous guidance 18-19%)
  • No technology transfer issues expected for TOPCon cell plant (machines already received)
  • ~70-80% of DCR panels use in-house cells; 20-30% bought from outside
  • ~50% of H1 revenue came from on-grid/DCR-based (subsidy) market
  • Addressing oversupply concerns: DCR cell shortage expected if ALMM List-II implemented (current run rate ~2.2 GW vs higher demand)
  • Southern expansion: Kerala and Tamil Nadu performing well; working on Andhra and Telangana
  • Debt increase primarily for Ratlam expansion (INR 100 crores) and working capital to support doubled business
  • Planning QIP for debt repayment
  • Committed to adding product-wise revenue breakdown in future investor presentations