SW Solar Ltd’s Share Price Crash: A Market Blunder Fueled by Hype.....

~Sûmōn Mukhopadhyay 

------------------------------------

In the news article (Moneycontrol, July 18), it was reported that shares of Waaree Energies, Premier Energies, and Sterling & Wilson Solar (SW Solar) dropped by up to 4% after U.S. companies petitioned for tariffs on solar panel imports from India.

Now, here's the catch:

👉 SW Solar Ltd (Rs.299.40) doesn’t even manufacture solar panels.

It’s an EPC (Engineering, Procurement & Construction) player that executes solar power projects — it buys panels from various suppliers based on market rates and project requirements.

I reiterate: it’s an EPC powerhouse—building solar projects, not manufacturing modules. It sources panels from whoever offers the best deal.

So why did the stock fall?

🧠 Pure Sentiment. Blind Panic. Zero Sense.

• The news triggered a broad “solar sector” selloff, where investors dumped anything remotely connected to solar — without checking what each company actually does.
• Waaree and Premier, both panel manufacturers, could indeed face export hurdles if tariffs are imposed by the US.
• But SW Solar? It can easily switch to local manufacturers if imported modules become costlier — giving it more sourcing options, not fewer.
• In fact, if Indian panel makers start offloading more modules domestically (due to reduced U.S. demand), SW Solar could procure panels at better prices — improving margins.

Conclusion:

The Takeaway:

The selloff in SW Solar Ltd (Rs 299.40) was misplaced — a textbook case of market overreaction to a headline without understanding the business model.