Behind the Panels: The Untold Story of Solar’s Real Money Makers
India’s solar journey has never been just about the shiny panels we see soaking up the sun.
Somewhere between the sun-kissed rooftops of Rajasthan and the industrial sheds lined with solar arrays, a quieter—but powerful—energy story is unfolding.
It’s about everything behind—and beyond—them.
And for discerning investors, that’s where the action might just be.
India’s solar capacity has soared from a humble 2.82 GW in 2014 to a staggering 100 GW by 2025.
The target? 500 GW of renewable capacity by 2030.
But in this solar gold rush, panel makers aren’t necessarily minting the most money.
In fact, many are grappling with wafer-thin margins, Chinese price wars, and erratic subsidy pipelines.
That’s where shadow stocks come in.
Beyond the Panel: Meet Solar’s Real Enablers
Panels may grab the headlines, but the enablers power the ecosystem.
Think of them as solar’s own ancillary universe—only here, the parts aren’t bolts and bearings, but inverters, batteries, glass, grid infrastructure, and more.
Take solar inverters, for example.
They’re the muscle behind the machine, converting solar power into usable electricity.
And because they need regular upgrades, they’re not just a one-time sale—they’re a recurring revenue play.
Look at players in this space, and you’ll find stocks that have quietly delivered multibagger returns over five years.
A leading Indian inverter manufacturer, Hitachi Energy India Ltd. has posted a 2,200% return with a trailing P/E of over 220—proof that the market rewards niche dominance even at high valuations.
Then there’s solar-plus-storage.
With storage systems now delivering 24x7 power at roughly ₹6 per kWh—on par with coal—India is rewriting the economics of energy reliability.
Battery makers are central to this shift.
They’re not just selling backup—they’re building grid resilience, enabling EVs, and powering smart energy systems.
Stocks in this segment show solid long-term performance and reasonable valuations, with Exide Industries Ltd. returning over 125% in five years while maintaining dividend yields.
The Chemical & Glass Edge
If you’ve never thought about solar glass, now’s the time.
Transparent, anti-reflective, weather-resistant—solar-grade glass is a niche with serious margin potential.
Add to that specific chemicals used for coating and cleaning solar cells, and you’ve got another revenue layer most investors overlook.
Borosil Renewables Ltd. for example, has delivered returns upwards of 1,200% in five years—even after accounting for recent volatility.
Meanwhile, chemical makers with solar-linked product lines such as Navin Fluorine International Ltd. (NAFL) are holding steady with high P/E ratios and over 150% long-term returns.
These aren’t moonshot bets.
They’re companies with export exposure, IP-led products, and tailwinds from global clean energy mandates.
Building the Backbone: Transmission & Grid Plays
Solar can’t power a nation if it can’t be transmitted.
That’s where grid and infrastructure players step in—building, maintaining, and upgrading the high-voltage highways that ferry solar energy from deserts to cities.
This space houses some of the clean energy story’s most consistent compounders.
They benefit from central orders, state demand, and international consultancy exposure.
Adani Energy Solutions Ltd. has clocked over 360% returns in five years with a relatively modest P/E ratio.
The Power Grid Corporation of India Ltd. (PGRD) in this segment—known for its grid reliability and dividend consistency—has delivered returns exceeding 210% while offering steady income through regular payouts.
And with India’s aggressive renewable rollout, including cross-border transmission ambitions, these companies aren’t just riding the solar wave—they’re directing it.
So, Where’s the Smart Money Going?
Solar shadow stocks might not sell panels—but they often earn higher, more stable margins.
Their business models aren’t always subsidy-dependent, and they serve a diversified range of clients across energy, infrastructure, and export.
Here’s a simple screening framework:
- Recurring Revenue Streams: Look for products such as inverters or storage systems that require regular maintenance or upgrades.
- Capex Leverage: Companies tied to the grid, infrastructure, or renewable energy spend (such as transmission, chemicals, and glass) often enjoy longer order visibility.
- Export/Policy Tailwinds: Firms benefiting from global solar adoption or Indian policy initiatives (such as Production Linked Incentives or net-zero targets) offer structural growth opportunities.
- Reasonable Valuations: Not every winner trades at triple-digit P/Es. Some strong performers in batteries and power infra remain value picks.
The solar megatrend is real—but it’s also evolving.
As competition compresses margins in panel manufacturing, the ecosystem around it could quietly deliver the next leg of returns.
In this energy race, solar panels catch the light—but it’s the shadow stocks that might catch the money.
Sources and References:
This article is for informational purposes only and does not constitute financial advice. It is not produced by the desk of the Kotak Securities Research Team, nor is it a report published by the Kotak Securities Research Team. The information presented is compiled from several secondary sources available on the internet and may change over time. Investors should conduct their own research and consult with financial professionals before making any investment decisions. The above images were generated using AI. Read the full disclaimer here.
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