Borosil Renewables’ stock dropped 5% to ₹472 following its Q3FY25 earnings report, which revealed a net loss of ₹30 crore and a notable decline in EBITDA. The company cited challenges from falling ex-factory prices and rising competition due to cheaper imports.
Shares of Borosil Renewables, a leading solar glass manufacturer and a subsidiary of the Borosil Group, were locked at a 5% lower circuit on February 17, 2025, falling to ₹472.45, marking a 10-week low. This decline followed the release of the company’s December quarter results, which failed to meet investor expectations.
For the quarter, Borosil Renewables reported consolidated revenue of ₹361 crore, showing an increase from ₹330 crore in the same period last year (Q3FY24), but a slight decline from ₹373 crore in the preceding quarter (Q2FY25). Despite the rise in revenue, the company experienced a sharp drop in EBITDA, which fell to ₹5 crore, down significantly from ₹24.08 crore in Q3FY24. The decrease in profitability was mainly attributed to challenges in the company’s Indian operations, where falling selling prices led to reduced margins.
Regarding net profit, the company posted a wider loss of ₹30 crore for the quarter, compared to a loss of ₹16 crore in the same period last year. The combination of lower profitability and intensified competition from cheaper imports contributed to the disappointing results.
Borosil Renewables explained that the imposition of a 10% Basic Customs Duty (BCD) on imports starting October 1, 2024, had no effect on the landed prices of imported glass. The company clarified that the primary reason for the drop in profitability was the sharp and continued decrease in Free on Board (FOB) prices from China during the second quarter of FY25. This decline was further exacerbated by a reduction in ocean freight costs during the third quarter of FY25, which further impacted the pricing structure.
The company also pointed out additional factors that contributed to the disappointing earnings. Non-recurring repair expenses amounting to ₹4.59 crore and costs related to the debit of rights issue expenses of ₹2.01 crore were significant contributors to the decrease in EBITDA.
Moreover, the company highlighted a concerning trend in the global market. Exporters from China and Vietnam significantly reduced the FOB prices of solar glass by up to 32% between June and September 2024. This aggressive pricing strategy led to a sharp drop in domestic prices, which the company noted were now at unsustainable levels, posing a threat to the survival of the solar glass industry.
Borosil Renewables reported that its export sales, including those to Special Economic Zone (SEZ) customers, amounted to ₹16.02 crore in Q3FY25, making up 6% of total turnover. This marks a significant decline compared to the ₹34.39 crore in export sales from the previous quarter, where exports accounted for 13% of the turnover. The company attributed this drop in export sales to lower demand in key export markets, driven by limited local manufacturing capabilities. Additionally, the market has been dominated by cheap solar modules imported from China, further affecting sales in these regions.
Over the past two months, the company’s stock has faced a notable downturn, losing 27% of its value. The share price has dropped from ₹643.90 per share to ₹472.45, reflecting investor concerns following the recent financial performance and the challenges facing the solar glass industry.
Borosil Renewables, India’s pioneering solar glass manufacturer, is a crucial player in producing low-iron, textured solar glass, which is essential for making solar photovoltaic modules in the power industry.
As power demand continues to increase, solar energy has emerged as the dominant source of new capacity additions in India over the past seven years. The Indian government has set an ambitious target of installing 280 GW of solar power capacity by 2030, which has significantly contributed to the growth of the solar energy sector.
To further support this expansion, several initiatives have been introduced, including the imposition of a Basic Customs Duty (BCD) on imported solar components, the Production-Linked Incentive (PLI) scheme, and policies that prioritize the use of domestic solar modules. These measures are helping to drive the demand for solar glass in India, as the country works towards meeting its renewable energy targets.