SWSL skids on reporting Q4 net loss of Rs 345 cr

Sterling and Wilson Solar (SWSL) slipped 1.83% to Rs 257.60 after the company's consolidated net loss stood at Rs 344.80 crore in Q4 FY21 compared with net profit of Rs 128.59 crore in Q4 FY20.

Revenue from operations dropped 33.8% to Rs 1,364.54 crore in Q4 FY21 from Rs 2,060.63 crore in Q4 FY20. Pre-tax loss stood at Rs 400.46 crore in Q4 FY21 as against a pre-tax profit of Rs 159.10 crore in Q4 FY20.

During the financial year, SWSL's reported a consolidated net loss of Rs 290.04 crore in Q4 FY21 compared with net profit of Rs 304.27 crore in Q4 FY20. Revenues from operations skid 8.86% to Rs 5,080.80 crore in Q4 FY21 from Rs 5,575.29 crore in Q4 FY20.

SWSL recorded a robust order inflow of Rs 7,936 crore for FY21 compared to restated order book of Rs 4,602 crore for FY20. However, the overall financial performance for FY21 was impacted due to one off exceptional events in Q4 FY21 comprising a prime subcontractor going bankrupt in Australia, increase in prices of modules, commodities as well as higher freight cost and provision for liquidated damages on account of delay due to COVID-19.

Commenting on the results, Amit Jain, global chief executive officer (CEO) of SWSL, said: "The prices of solar modules have seen an unprecedented increase over the past few months. This was on account of significant increase in the cost of the key raw material 'polysilicon'. Prices of aluminium, copper and steel have also risen along with freight costs. We expect the sector to continue to face some pressure in the near term on account of rising solar module prices, increase in commodity cost and supply chain disruptions caused due to COVID-19 outbreak. However, we are working with our clients to mitigate these issues and find a win-win solution."

"We are geared up to overcome these challenges and expect growth to pick up given the strong fundamentals, government and regulatory commitment, and continued investor interest in the sector. With the COVID-19 wave on the wane globally, we expect logistics and supply chain issues to get ironed out by Q2 FY22 and return to pre-COVID levels. We also expect our operational effectiveness to normalise in H2 FY22. Our unexecuted order book as on 29th June 2021 stands at Rs 9,348 crore, which is executable over the period of next 12 to 15 months. Our current bid pipeline continues to remain strong."

"Driven by increasing environmental concerns due to the use of conventional energy, the international solar power industry will continue to grow at rapid pace over next 2-3 decades. With our compelling business model, global footprint, deep-rooted client relationships, ability to provide customized solutions and strong track record of executing complex and large-scale projects supported by a robust balance sheet, we are confident of maintaining our position as the leading player in the global solar power EPC market."

SWSL, a Shapoorji Pallonji group company, is a global pure-play, end-to-end solar engineering, procurement and construction (EPC) solutions provider. The company provides EPC services primarily for utility scale solar power projects with a focus on project design and engineering and manages all aspects of project execution from conceptualizing to commissioning. It also provides operations and maintenance (O&M) services, including for projects constructed by third parties.

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