Green Stocks Feb 18: Bottom Fishing To Emerge Soon In RE Stocks?

With no respite for the market in a volatile trade environment, green energy stocks continued to be buffeted by the winds from the US. A lot of what US President Donald Trump has already proven to be hot air, but the sheer impact of the US remains large enough to shake up global markets. India for whom the US is its largest trading partner, is no exception, and our markets reflect that fear of disruption.

For green energy stocks in India in particular, the impact of Trump’s actions should actually be limited, considering how domestic-focused the broader industry is. That possibly explains the bottom fishing that is beginning to emerge in beaten-down stocks that retain a decent narrative in terms of strong order books, an even bigger pipeline of tenders they have bid for, and finally, acceptable Q3 results.

Today it was the turn of Borosil Renewables to benefit, as bargain hunters swooped in hoping to benefit from a stock that has been pulled won too far, in their view. For the record, the firm has declared underwhelming Q3 results, slipping into losses at post-tax levels yet again, with little growth to show in the face of further lowering of prices by Chinese competitors.

In the solar sector at least, the basic price difference at the manufacturing level between Indian manufacturers and their Chinese counterparts does seen to be 50% or higher, which is a significant bridge to cross yet. The reasons might go beyond the factory floor, but this is a fact backed by numbers for now. That explains the high price of domestically made solar cells as well as solar glass in the case of Borosil.

What will probably surprise many market watchers is the correction in Solar EPC stocks, most of which are down 35-40% in the past 5 months. While one could argue valuations were too rich a few months back, they certainly seem reasonable now, and the same stocks could rebound strongly in case of a broader reversal in the sliding markets. The question is, do investors have the stomach for any more losses?

Company Name	Closing Price on February 18	Change %
Borosil Renewables Ltd	500.40	+4.99%
Waaree Renewable Technologies Ltd	840.10	+0.54%
Sterling and Wilson Renewable Energy Ltd	254.20	-3.77%
KPI Green Energy Ltd	375.75	-4.99%
Shakti Pumps (INDIA) LTD	810.75	-2.18%
Acme Solar	181.00	+1.87%
SUZLON ENERGY LTD	50.63	-1.54%
Adani Green Ltd	894.30	+0.44%
Inox Wind	163.00	-4.56%
Gensol Engineering Ltd	574.00	+1.49%
Premier Energies	977.00	+0.82%
Waaree Energies	2,170.05	-0.16%
Tata Power	338.90	+0.50%
NTPC Green	104.85	+0.02%