With slower power demand, PPA tie-up momentum and execution ability in focus: Acme Solar (ACME) remains our top pick in the Power/Renewables space, with the stock up 45% in the last six months. With a slowdown in power demand in FY26YTD, investors have shifted focus to earnings growth backed by power purchase agreements and an ability to execute projects on time and within budget. For ACME, we are building installed capacity to rise from 2.5GW at the end of FY25 to 5.5GW by the end of FY28. Based on our estimates, the annualized EBITDA from the entire pipeline of ~6.7GW will amount to ~INR81b post-commissioning. Reiterate BUY with a revised TP of INR370.
OutlookACME trades at FY27 EV/EBITDA of 15.5x vs NTPC Green (13.3x, consensus estimate) and JSW Energy (12.6x). We value ACME at 10x FY28E EBITDA (discounted by one year) to arrive at our TP of INR370, implying a 34% potential upside.
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