Overview
WindForce is a diversified renewable-energy group spanning wind, solar, small hydro, EPC, operations and maintenance, and battery storage. The latest quarter showed continued operating growth, but the increase in revenue did not translate proportionately into profit, leaving execution and valuation in tension with the company’s expansion pipeline.
Price performance
At the LKR 40.80 close on 2026-08-14, WindForce had fallen 14.1% over three months while the ASPI fell 5.6%. Over one year, it gained 54.5% against the index’s 9.3% rise, showing substantial long-term outperformance despite the recent retreat.
The share sits just above the midpoint of its 52-week range. Trading volume was 78.5% below its own 60-day norm, while recent volatility was below the company’s own one-year level, indicating quieter price activity rather than lower market risk.
Valuation
WindForce’s P/E of 36.45 is well above the power and energy sector median of 14.82 and ranks at the sector’s 88th percentile among nine companies. Its P/B of 2.11 is also above the 1.89 median, though its 7.7% audited-year ROE provides limited support for that premium.
The 2.5% dividend yield is not unusually high against the sector, and the payout direction is mixed: dividends per share were LKR 1.00 in FY2025 and FY2024, compared with LKR 1.30 in FY2022. No dividend is recorded for FY2023, so the yield does not represent a steadily rising payout record.
News and sentiment
Company coverage was normal over the 90-day window, with nine material articles split between four positive, four negative and one neutral report. The more recent 30-day flow was unusually quiet, with no articles against a baseline of 4.8 per month.
The main disclosed developments were IFC financing of up to US$18 million for a 100MW solar project and WindForce’s 51% stake in the Storex battery-storage venture. The confirmed LKR 1.00 first interim dividend had an ex-date of 2025-02-25 and payment date of 2025-03-18. The share’s 14.1% three-month fall therefore has no company news in the latest 30-day flow that accounts for it.
Financials
For the quarter ended 2026-06-30, revenue rose 23.4% year-on-year to LKR 2.62 billion, while operating profit grew 10.1% to LKR 1.11 billion and net profit grew 5.1% to LKR 875 million. The slower profit increase indicates that growth was not fully retained below the operating line, where finance costs, tax, associates and foreign exchange created a LKR 240 million drag.
Margins were weaker than the comparable June quarter despite the higher profit. Gross margin fell from 61.8% to 55.7%, operating margin from 47.7% to 42.5%, and net margin from 39.2% to 33.4%. Each was near the bottom of the company’s same-quarter history: gross and net margin were the worst of six June quarters, while operating margin ranked fifth of six.
The latest group filing reported LKR 26.15 billion of equity attributable to owners and 1.35 billion shares outstanding, compared with LKR 24.22 billion and 1.35 billion respectively in June 2025. The latest quarter is historical: the reported news and projects are later developments, so these figures do not capture their financial contribution.
Risks
The largest financial risk is the expansion funding burden. Total debt reached LKR 22.28 billion at 2026-06-30, while the latest audited balance-sheet period reported interest cover of 2.93 times. Gearing was 32.8% of owners’ equity at 2024-03-31, but gearing and debt were not reported for the 2025-03-31 annual balance sheet.
Liquidity was stronger in the latest audited period, with a current ratio of 3.48, but the twelve months to 2026-06-30 had cash conversion of -2.39 times. This means the reconstructed twelve-month operating profit was not matched by operating cash flow. Free cash flow was LKR 416 million in the 2025 audited year, providing only modest headroom against a capital-intensive project pipeline.
Minority shareholders received 20.6% of group profit in the 2025 audited year. Group net profit therefore overstates the profit belonging to WindForce’s listed shareholders, making group earnings and the stock’s EPS an imperfectly matched pair. Sector-wide fuel-cost and supply pressures also remain relevant to the power and energy environment, although the supplied sector reports do not attribute those pressures specifically to WindForce.
Outlook
The next defined event is the quarter ending 2026-09-30, with the filing expected between 2026-11-07 and 2027-01-07. That filing will show whether the recent operating growth is accompanied by stronger cash generation and whether the IFC-backed solar and Storex storage initiatives have begun contributing financially; the current data cannot establish either point.
As at 2026-08-16, lower interest-rate expectations and planned grid modernisation form a constructive backdrop for renewable infrastructure, while elevated energy-cost inflation remains a sector risk. The company’s own disclosed financing and project awards strengthen its development platform, but the next filing is needed to distinguish expansion commitments from earnings delivered.