S&W Solar Expands Menu, Adds Hybrid energy, Storage and Waste To Energy

Sterling and Wilson Solar Limited (S&W Solar) has announced that it will be expanding its EPC (Engineering, Procurement and construction) solutions offerings to cover Hybrid energy projects as well now. Besides this, it will double don further on its energy storage solutions and waste to energy offering now.

Hybrid energy solutions involve combining two or even more energy options  that are combined, usually to ensure uninterrupted supply or more more consistent supply of energy.  Plain vanilla solar projects, which have been the mainstay of the publicly listed Sterling and Wilson Solar’s business so far, are increasingly being seen as nearing the end of their cycle, as solar gets combined with wind, and energy storage solutions to deliver power for a longer period.

For Sterling and Wilson Solar, the move is a natural expansion considering its vast experience as an EPC firm with project management track record of delivering massive projects. The firm has a global presence, with projects across continents, especially North America, Australia, Africa,  South America and of course Asia. The firm has been associated with some of the most prestigious projects in these regions.

The firm has been hit by the volatility in the solar sector recently, slipping into losses in its Q4 quarter this year, after major issues with suppliers in key projects. To that extent, like its push into solar O&M (operations and maintenance), the move into storage and waste to energy can also be seen as a further derisking of the portfolio from the vagaries of just one sector, solar.

A strong record in the energy sector definitely gives it a foot in the door for the energy opportunities, especially in the renewable energy ecosystem. However, the firm also seems headed for a strong overlap at some stage with the plans of another group firm owned by the Shapoorji Pallonjee group, Sterling and Wilson Private Limited.

One problem the firm does face is its inability to leverage its access to public markets, even in these buoyant times. Thanks to an extended delay in loan repayments to the firm by the promoters, the company finds its stock rated poorly, and trading way below its issue price to common shareholders. A situation that has not been improved by its inconsistent financial performance, ironically, much like its mainstay solar energy, in the form of sharp earnings volatility over successive quarters. That unpredictability has weighed down the stock to a level well below what it was aiming for in terms of valuations.

The firm recently saw the elevation of Amit Jain to the Global CEO role, and this actually marks the first major announcement since he took over.