Waaree Energies Explains How It Fought Silver Price & Other Commodity Price Hikes

Indian solar module manufacturer Waaree Energies has detailed how it mitigated the impact of rising silver and other key commodity prices to avoid aggressive price increases for its solar modules. Speaking during its latest investor call, the company’s management outlined the key challenges it faced and the measures taken to protect margins and maintain pricing discipline.

Silver Price Volatility and Margin Stability

Addressing concerns over rising silver and commodity prices, management said gross margins have remained structurally stable, supported by higher capacity utilisation, a strong share of Domestic Content Requirement (DCR) orders, and ongoing efficiency improvements.

Waaree said it follows a strict back-to-back hedging policy and carries no speculative exposure to commodities. The impact of silver price fluctuations is estimated at less than ₹9 per module, which is largely absorbed through operating leverage and scale efficiencies.

Pricing discipline was another focus area. Despite being largely sold out on capacity, the company said it has refrained from aggressive price hikes. Orders continue to be booked with advance payments of 5–15%, while in the retail segment, full payment is received prior to dispatch.

The current order book is split around 35% domestic and 65% international. Of domestic orders, roughly 80–85% are non-DCR, with most supported by captive cell supply.

Cell Capacity Ramp-Up and Efficiency Improvements

During the Q&A session, investors sought clarity on cell manufacturing utilisation and yields, particularly after reported utilisation of 56%, which management attributed to initial breakage and effluent-handling challenges during ramp-up.

Management said utilisation has already improved to about 80–81% and is expected to reach 85–90% over the next three months following upgrades to G12R technology. These issues were described as typical start-up challenges and largely resolved.

On capacity calculations, the company clarified that its stated 5.4 GW cell capacity is derived from cell output multiplied by volume, with current efficiencies of around 24–24.5%. The transition to G12-format cells enables higher wattage per cell, improving output without a proportionate increase in input costs.

“Waaree 2.0” Growth Strategy

The earnings call was also used to outline the company’s next growth phase, branded “Waaree 2.0”, which focuses on deeper vertical integration across the solar value chain.

Beyond core module and cell manufacturing, the company plans to expand into adjacent clean-energy and electrical segments. This includes battery energy storage capacity of 20 GWh by FY28, inverter manufacturing capacity of 4 GW, transformer capacity of 20,000 MVA, and electrolyser capacity of 1 GW by FY27.

US Market Exposure and Risk Mitigation

The US continues to be a key growth market. During the third quarter, Waaree generated more than ₹2,000 crore in US revenue, supported by sales of 313 MW through a mix of domestic manufacturing and exports. The company also booked around ₹80 crore under the US Inflation Reduction Act (IRA), representing roughly 90% of the eligible incentive at 7 cents per watt.

On risks related to tariffs and trade measures, management said its strategy focuses on regulatory compliance and geographic diversification. The ramp-up of US manufacturing capacity and the use of non-India-origin cells where required are expected to mitigate exposure to trade actions. The Oman polysilicon facility further strengthens traceability and compliance with evolving origin requirements.

While the company has not issued formal guidance for FY27, management said it remains confident of sustaining healthy margins and growth momentum, supported by strong demand visibility and a progressively integrated manufacturing platform.