Waaree Energies Limited, a stalwart in the Indian solar photovoltaic (PV) manufacturing landscape, will officially open the bidding for its much-anticipated initial public offering (IPO) on October 21, 2024. With the IPO price band set between ₹1,427 and ₹1,503 per share, investors have a prime opportunity to tap into a company that has not only established itself as a market leader but is also positioned to capitalize on the growing demand for renewable energy in India.
Founded in December 1990, Waaree Energies has built an impressive portfolio, boasting an installed capacity of 12 gigawatts (GW) across its manufacturing facilities in Gujarat. The company specializes in a diverse range of solar modules, including multicrystalline, monocrystalline, and cutting-edge TopCon modules, which feature both framed and unframed bifacial designs. With the world increasingly moving towards sustainable energy sources, Waaree’s extensive experience and innovative technology make it a key player in the renewable sector.
The upcoming IPO aims to raise a staggering ₹4,321.44 crore, with ₹3,600 crore coming from the fresh issue and an additional ₹721.44 crore from the offer for sale (OFS). This significant financial maneuver reflects not just Waaree’s ambition but also its commitment to expanding its manufacturing capabilities to meet the burgeoning market demand. Following the IPO, Waaree Energies will enjoy a post-issue market capitalization of ₹43,179 crore, further solidifying its status as a market heavyweight.
A noteworthy aspect of the IPO is the allocation strategy, which has been crafted to appeal to various investor segments. Retail investors can secure a share of the action with a minimum bid of nine equity shares, while 35% of the total shares are reserved for them. The remaining shares will be divided among qualified institutional buyers (50%) and non-institutional investors (15%). This balanced allocation strategy highlights the company’s commitment to inclusivity and broad-based participation in its growth story.
One of the standout features of this IPO is the significant focus on employee welfare. Waaree Energies has reserved ₹65 crore worth of equity shares specifically for its employees, a move that not only fosters loyalty but also aligns the workforce’s interests with the company’s performance. This approach is increasingly becoming a hallmark of forward-thinking companies that recognize the value of their human capital.
Waaree’s financial performance further substantiates its strong market position. For the quarter ending June 30, 2024, the company reported a net profit of ₹401.13 crore, with revenue soaring to ₹3,496.41 crore. For the full fiscal year of 2024, Waaree Energies posted an impressive net profit of ₹1,274.38 crore, backed by total revenues of ₹11,632.76 crore. Such robust financials indicate not only operational efficiency but also a solid foundation for future growth.
The proceeds from the fresh issue will primarily be directed towards establishing a new 6 GW ingot wafer, solar cell, and solar PV module manufacturing facility in Odisha. This ambitious project is set to enhance Waaree’s production capabilities and further position it to meet India’s escalating energy demands. Additionally, the remaining funds will be allocated to general corporate purposes, ensuring the company remains agile in its operational strategies.
In terms of valuation, Waaree Energies appears to be attractive, with a price-to-earnings ratio of 86.3x for FY23, projected to decrease to 33.9x for FY24, and an adjusted figure of 46.3x for FY24. This trajectory suggests that the company is likely to experience significant growth in the coming years, offering a promising investment opportunity for stakeholders looking to capitalize on the solar boom.
The IPO process will see various important milestones, with the anchor book opening on October 18, 2024, followed by the main subscription phase from October 21 to October 23, 2024. Shares are expected to list on October 28, 2024, providing investors with a relatively quick turnaround to see the fruits of their investment.
The lineup of lead managers is impressive, with renowned financial institutions such as Axis Capital, IIFL Securities, Jefferies India, Nomura Financial Advisory, SBI Capital Markets, Intensive Fiscal Services, and ITI Capital Ltd steering the offering. Link Intime India will serve as the registrar for the IPO, ensuring smooth processing and management of subscriptions.
Waaree Energies’ IPO is more than just a financial endeavor; it represents a pivotal moment in India’s renewable energy journey. As the nation pushes towards sustainability, companies like Waaree Energies stand at the forefront, harnessing solar power to meet both domestic and international energy needs. For investors, this IPO presents a unique opportunity to not only gain financially but also to contribute to a greener future.
In conclusion, Waaree Energies Limited is set to capture the spotlight with its IPO, making waves in the solar energy sector. With a robust business model, strong financial performance, and a commitment to expansion, the company is well-positioned to leverage the increasing global shift towards renewable energy. As the bidding date approaches, potential investors are advised to closely consider the opportunity presented by Waaree Energies and its promising growth trajectory in the renewable energy landscape.
