Vikram Solar shares plunged over 10% on Friday, hitting a fresh 52-week low of ₹155.38 on the NSE after the company reported an 85% year-on-year decline in Q1 net profit to ₹20 crore. As per Business Standard, the stock was trading 4.79% lower at ₹165.62 as of 11:37 AM, with the intraday decline reaching 10.40% before hitting the new low. The stock has been overall down 30.12% in 2026 so far, significantly underperforming the broader market which has gained 0.18% year-to-date. The company currently maintains a market capitalisation of more than ₹6,066 crore with a P/E ratio of near 18x. According to Globe Capital Market's Vipin Kumar, the stock has been forming a sequence of lower lows and lower highs below its key moving averages since listing, with a decisive fall below the ₹160 mark being a major negative development.
According to latest reports, Vikram Solar experienced a significant decline in profitability during Q1 FY27, with consolidated net profit falling 85% to ₹20 crore compared to ₹133 crore in the corresponding quarter of the previous year. Despite this substantial profit decline, the company demonstrated strong revenue momentum with consolidated revenue from core operations rising 38% YoY to ₹1,563 crore from ₹1,134 crore in Q1 FY26. The company's EBITDA margins contracted significantly to 8.06% from 21.36% in the same period last year, with EBITDA dropping 48% to ₹126 crore from ₹242 crore year-over-year. As per the company's unaudited financial results approved by the Board on August 6, 2026, the profitability decline was primarily attributed to surging material and service costs that outpaced revenue growth.
The company's financial performance was significantly impacted by raw material costs surging 63.4% to ₹1,385 crore in the April to June quarter of FY27, compared with ₹847 crore in the same period of the previous financial year. According to NSE filings, total expenses for the period under review surged 62% YoY to ₹1,550 crore, compared to ₹957 crore in the same period a year earlier. This surge in raw material costs, which weighed down the company's margins, translated into lower profits for the quarter under review. The 63% surge in raw material cost was the primary driver of the overall 62% rise in expenses, highlighting the immediate impact of elevated input prices on profitability even as the company scales production volumes.
In a significant strategic move, Vikram Solar's board has approved the enhancement of its proposed backward-integrated wafer and ingot manufacturing facility at its Gangaikondan site, Tamil Nadu, from 6 GW to 9 GW, which is scheduled to be commissioned by FY29. This expansion represents a major capacity enhancement that could significantly strengthen the company's vertical integration and reduce dependence on external suppliers. The facility expansion aligns with the company's strategy to enhance its backward integration capabilities and improve operational efficiency in the long term.
According to Business Standard, Vikram Solar's stock has significantly underperformed the broader market across all time periods. The stock declined 6.7% over the past week, compared with a 1.22% gain in the Nifty Total Market index. Over the one-month period, the stock fell 9.65%, while the index rose 1.60%. On a year-to-date basis, Vikram Solar shares have declined 30.12%, compared with a marginal 0.18% decline in the Nifty Total Market index. The company's performance reflects broader market concerns about margin compression and rising cost pressures in the solar manufacturing sector.
