Module Demand To Rise Significantly In FY26, FY27: SBI Caps

Module Demand To Rise Significantly In FY26, FY27: SBI Caps

A latest report from SBI CAPS claimed that the annual module demand is likely to touch 100 GW soon. The report said the higher demand is likely to be triggered with the faster pace of adoption of solar power. The report also said that the faster pace of PM Surya Ghar scheme installations could also push demand for more solar modules.

“Solar capacity additions reached unprecedented levels, demonstrating resilience to demand fluctuations. Accelerated deployment, projected at ~85-90 GW combined for FY26-FY27, is anticipated, with residential rooftop solar driving expansion. Annual module demand is forecast at ~100 GW,” the report said.

India’s Cell Imports To Continue 

It also added, “Realisation of our projections hinges on moderate PPA-PSA gap reduction, PM-SGMBY completion by FY28, and enhanced RPO compliance. Land constraints, ALCM implementation, and restrictive state net metering policies pose downside risks. Conversely, timely scheme (especially PM-KUSUM) and project execution could further augment demand.”

Module Demand To Rise Significantly In FY26, FY27: SBI Caps

The SBI CAPS report also said that more than half of India’s cell requirements will continue to be imported in FY27. “~90 GW of demand for ALMM modules is expected to be fulfilled using domestic capacities by FY27 (currently ~70 GW), with the remainder, consisting largely of C&I captive lapping up cheaper imports. Despite integration factor (cell/module capacity ratio) likely improving from ~32% to ~65%, more than half of India’s cell requirements will continue to be imported in FY27, even if all capacities promised come on board,” the report said.

Changing Dynamics In US

The report also said that the new changing political dynamics in the United States (US) is likely to hamper the solar module exports to the US. “A diminished US focus on green energy could suppress panel demand, exacerbating global supply-demand imbalances and eroding US market price premiums, negatively impacting Indian exporter margins. Inflation Reduction Act withdrawal presents dual risks: export margin erosion and overseas facility write-downs, countered by potential discouragement of US domestic capacity expansion, benefiting Indian producers. European ULFP adoption offers alternative market access. Export-oriented entities thus bear heightened downside risk,” the report said.

Module Demand To Rise Significantly In FY26, FY27: SBI Caps

The report said that going by the announcements of expansion of solar module makers, India’s solar module nameplate capacity is likely to move from 90-100 GW to 150-160 GW by FY27. This translates to an effective capacity of 90-100 GW by FY27.