ACME Solar Share Price Surges 7% Following HSBC's 'Buy' Rating and Up to 30% Upside Potential Forecast

ACME Solar Holdings Ltd Sees Share Price Surge Following HSBC's 'Buy' Rating

Shares of ACME Solar Holdings Ltd rose nearly 7% on Monday, April 13, defying weak market trends. This surge can be attributed to HSBC's initiation of coverage with a 'Buy' rating and a target price of ₹350, indicating an upside of 30%.

Strategic Growth and Expansion Plans

HSBC highlighted that ACME currently operates around 3 GW of generation capacity, with an additional ~3.3 GW tied up under long-term, 25-year power purchase agreements (PPAs). These contracted projects are expected to drive a 2.7x increase in overall capacity over the next two to three years. Furthermore, the company has a further 1.8 GW of awarded projects that are yet to be converted into PPAs, providing additional growth visibility.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

Renewable Energy Focus and Diversification

ACME is transitioning from a pure-play solar developer to a diversified renewable energy player, focusing on firm and dispatchable renewable energy (FDRE) solutions that integrate solar, wind, and battery storage. This strategic shift is expected to provide long-term growth opportunities.

Financial Projections and Risks

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

HSBC forecasts EBITDA to grow at a CAGR of 72% over FY26-28. Earnings visibility is strong as 84% of ACME's contracted portfolio with 25-year fixed tariff PPAs are backed by central government agencies. However, key downside risks include relatively high leverage and potential risks from rising equipment and borrowing costs.

Market Sentiment and Technical Analysis

According to Rajesh Bhosale, Equity Technical and Derivative Analyst at Angel One, shares of ACME Solar Holdings are exhibiting a strong bullish trend, forming a higher top–higher bottom structure and trading above all key moving averages. Ruchit Jain, Head - Equity Technical Research, Wealth Management, Motilal Oswal Financial Services, also views the stock as bullish, with immediate supports placed around ₹261 and ₹250.