Why shares of Waaree Energies, Premier Energies & other solar stocks fell today?

The Indian solar sector faced a turbulent session on Wednesday, February 25, 2026, as shares of major domestic manufacturers plummeted following a significant trade move by the United States. This sharp sell-off was triggered by the U.S. Department of Commerce's decision to impose preliminary countervailing duties (CVD) on solar imports from India, Indonesia, and Laos. The market reaction was swift, with several leading stocks recording double-digit losses in early trade as investors weighed the impact of these hefty levies on future export revenues.

Waaree Energies and Premier Energies were among the hardest hit, with their stock prices tumbling by as much as 14 per cent to 15 per cent. Waaree Energies saw its shares drop to a day's low of Rs 2,571.45, while Premier Energies slipped to approximately Rs 696.25. Other players in the ecosystem were not spared; Vikram Solar declined by over 7.5 per cent, and Borosil Renewables witnessed a more modest but notable dip. This broad-based decline occurred even as the benchmark Nifty 50 index posted a slight 0.57 per cent gain, highlighting a decoupling of solar stocks from broader market sentiment.

The U.S. government has set a preliminary duty of 125.87 per cent for all Indian solar producers. This determination stems from an investigation into foreign subsidies that Washington claims allow exporters to undercut domestic American manufacturers. Similar actions were taken against Indonesia and Laos, with initial duties ranging from 81 per cent to 143 per cent. These measures are distinct from the general 10 per cent to 15 per cent tariffs recently introduced by the Trump administration, representing a much more targeted and aggressive barrier for the renewable energy trade.

This regulatory hurdle comes at a time when Indian solar exports to the U.S. had been experiencing exponential growth. According to data from the International Trade Administration (ITA), the volume of exports surged from roughly 232 million watts in 2022 to nearly 2.29 billion watts in 2024. In monetary terms, the value of these shipments skyrocketed from approximately USD 84 million to over USD 792.6 million in just two years. The new 126 per cent duty threatens to make the U.S. market—a primary destination for high-value exports—largely unavailable for many Indian firms.

The impact on individual companies varies based on their "export exposure," or the percentage of revenue derived from international markets. Waaree Energies and Vikram Solar have significant exposure, with Waaree deriving nearly 29 per cent of its revenue from exports and Vikram Solar around 16 per cent. In contrast, Premier Energies reportedly has negligible to no export exposure. Analysts suggest that the decline in Premier Energies' stock was likely driven by "spillover sentiment," where investors panic and sell off all stocks within a specific sector regardless of their individual fundamental risks.

Despite the immediate market volatility, the long-term domestic outlook for these companies remains anchored by India's internal energy targets. The country's installed solar capacity stood at 136 GW as of late 2025, which is still far from the government’s ambitious goal of 280 GW by 2030. Brokerages like Motilal Oswal suggest that even if the U.S. market becomes restricted, a significant "growth runway" exists within India, with an expected annual demand of 50-60 GW of solar modules beyond 2030 to meet rising power needs.

The U.S. policy shift reflects a complex geopolitical landscape. Developers in the U.S. had recently turned to India, Indonesia, and Laos for supplies after Washington imposed duties on other Southeast Asian nations. These three countries accounted for 57 per cent of all solar module imports to the U.S. in the first half of 2025. While the new duties aim to protect American manufacturers, they also introduce uncertainty for the global renewable energy industry and could lead to increased costs for solar project developers and consumers within the U.S.

To mitigate such trade risks, some Indian companies have already begun diversifying their operational footprints. For instance, Waaree Energies—which maintains a massive order book of approximately Rs 60,000 crore—has recently inaugurated a 1.6 GW module manufacturing facility located directly within the United States. Such strategic moves may allow companies to bypass import duties by manufacturing "on-shore," though the immediate financial impact of the 126 per cent tariff on existing export models continues to weigh heavily on investor confidence.

Disclaimer: The article is for informational purposes only and not investment advice.