Waaree Energies Shares Slide amid US Senate Proposal to Cut Solar Incentives

Waaree Energies shares continued their downward trajectory on Wednesday after the US Senate panel's recent proposal to phase out federal tax credits for solar and wind energy by 2028 weighed down the investment sentiment.

At 11:40 am, Waaree Energies shares were trading at ₹2,708.40 price level, down by 2.94% on the National Stock Exchange. In the last 2 trading sessions, the renewable energies stock has lost over 5% on the bourses.

As per the Senate panel's draft bill, subsidies introduced under the Biden administration’s 2022 Inflation Reduction Act would be phased out much earlier than previously planned. Tax incentives for solar and wind projects would be reduced to 60% of their current value by 2026 and eliminated entirely by 2028.

The proposal also aims to redirect these incentives toward other energy sectors, including nuclear, hydropower and geothermal projects. Following the announcement of the bill, major solar stocks witnessed a sharp plummet on the Wall Street. For instance, FirstSolar shares plummeted over 17% on the Nasdaq. Shares of Solaredge Technologies Inc experienced an even steeper decline of more than 33%. Stock prices of Enphase Energy Inc. and Sunrun Inc. dropped over 23% and 40% respectively.

Waaree Energies Share Price

So far this year, the renewable energy stock has struggled to trade in the green territory, declining over 5.6% on the NSE. In the last 6 months period, the shares have witnessed a double-digit drop of 11.16%. Currently, the shares of the company are down by more than 27% from their 52-week high price level of ₹3,743.

Waaree Energies was the first Indian renewable energy company to set up a PV module manufacturing facility in the US. Considering its operational presence in the country, any changes on the tax credit front are likely to have an impact on Waaree Energies' margins.