Premier Energies, Waaree Energies Shares Drop 6% After Solar Sourcing Deadline Extension

Shares of Premier Energies and Waaree Energies dropped as much as 6% in Monday trading after the central government extended the deadline for domestic solar cell sourcing under the Approved List of Models and Manufacturers (ALMM) for certain project categories.

The Ministry of New and Renewable Energy (MNRE) has pushed the compliance date for net metering and open access projects to December 31, 2026. The move effectively allows developers to use imported solar modules until the end of next year for these segments.

Market Reaction

Premier Energies shares were trading at ₹1,242.50, down 5.8% from the previous close, while Waaree Energies fell 5.9% to ₹2,890. Analysts attributed the selloff to concerns that the policy relaxation could delay the ramp-up of domestic solar cell manufacturing capacity.

The broader solar energy index also slipped, but the losses in these two stocks were the most pronounced among the sector peers.

Policy Background

The ALMM mandate, which requires solar projects to use domestically manufactured cells and modules, was rolled out earlier this year to boost local manufacturing under the Production Linked Incentive (PLI) scheme. The government had initially set a strict timeline for compliance.

Industry bodies had been pleading for more time, arguing that domestic cell production capacity was still insufficient to meet the demand from open access and net metering projects. The MNRE's decision, announced late last week, grants a six-month extension for these segments.

For utility-scale projects, the original deadline remains unchanged.

What This Means for Manufacturers

The extension is a double-edged sword for companies like Premier Energies and Waaree Energies. While it opens the door for cheaper imported cells in the near term, it also pushes back the timeline for when domestic manufacturers can expect a guaranteed market for their output.

Both companies have been expanding their cell and module manufacturing capacities in anticipation of strong demand from the ALMM mandate. The policy relaxation could temporarily soften pricing power for domestic players.

Analysts at brokerage firms have noted that the extension provides relief to project developers struggling with supply chain constraints, but it may delay the financial benefits that manufacturers were counting on from the protectionist policy.

Forward Look

All eyes will now be on whether the government extends similar relief to utility-scale projects. The MNRE has not indicated any further changes, but industry sources suggest more representations are being made. The next few months will test how quickly domestic solar cell production can scale up to meet the revised timeline.