ACME Solar gains nearly 3%, hits 52-week high after Elara Capital initiates coverage

Shares of ACME Solar Holdings rose nearly 3% on Friday’s session to trade at Rs 295, following a bullish outlook from Elara Capital. The stock also touched a new 52-week high of Rs 303.94.

The surge in the company's stock prices comes after Elara Capital initiated coverage on the stock with a ‘Buy’ rating and a target price of Rs 325, suggesting an upside of over 10% from current levels and around 30% from the time of the report’s release.

In its research report, Elara highlighted ACME Solar’s strong execution track record and aggressive growth roadmap. The company currently operates 2,826 MW of solar power capacity and has another 4,143 MW under development. With a strategic focus on firm and dispatchable renewable energy (FDRE) and hybrid energy projects, ACME aims to boost returns and strengthen grid stability.


The report projects that ACME Solar is poised to scale its capacity from 2.8 GW to 7.0 GW by FY28, supported by a robust project pipeline. During this period, the company is expected to deliver a 49% revenue CAGR and a 59% EBITDA CAGR.

The stock trades at 8.3x FY28E EV/EBITDA and 13.2x FY28E P/E. Elara assigns a valuation multiple of 9.0x EV/EBITDA, justifying the Rs 325 target price.

With India's renewable energy sector gaining momentum, ACME Solar’s expanding footprint and strong financial outlook appear well-positioned to capitalise on long-term growth opportunities.

Technicals:

The 14-day Relative Strength Index (RSI) for the stock stands at 79.9, which is above the typical overbought threshold of 70. This suggests that the stock may be due for a short-term pullback or consolidation as buying momentum could be overheating.

On the positive side, the stock is showing strong technical strength with all seven key Simple Moving Averages (SMAs)—ranging from the short-term 5-day SMA to the long-term 150-day SMA—trading below the current price. This bullish alignment of moving averages indicates sustained upward momentum and a healthy trend.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)