The initial public offering (IPO) of Waaree Energies Ltd received a solid response from investors during the first day (Day 1) of bidding process, led by non-institutional investors (NIIs) and retailers. As per BSE data available on Monday, the portion for NIIs was subscribed 8.09 times and retail investors got bids to the tune of 3.17 times.
The categories kept for employees and qualified institutional buyers (QIBs) saw 1.57 times and 8 per cent bids, respectively. The issue received 6,98,85,360 bids against 2,10,79,384 shares on offer with an overall subscription of 3.32 times.
The three-day public subscription of India's largest solar module manufacturer will conclude on October 23. The price band for the shares is set between Rs 1,427 and Rs 1,503. Waaree aims to raise Rs 4,321.4 crore, including a fresh issue of Rs 3,600 crore through 2.39 crore equity shares and an offer-for-sale worth Rs 721 crore by promoters.
Bajaj Broking has recommended to subscribe the IPO with a long-term perspective. "For the last three fiscals, the company has reported an average EPS of Rs 31.94 (basic), and an average RoNW of 26.95 per cent. The issue is priced at a P/BV of 8.84 based on its NAV of Rs 169.94 as of June 30, 2024, and at a P/BV of 5.35 based on its post-IPO NAV of Rs 281.16 per share (at the upper cap). If we attribute FY25 annualized super earnings to its post-IPO fully diluted paid-up equity capital, then the asking price is at a P/E of 26.91, and based on FY24 earnings, the P/E stands at 44.36. The issue relatively appears fully priced," it stated.
Waaree Energies' future looks strong, driven by ongoing capacity expansion, a robust order book, and growing demand for renewable energy. The 6 GW facility in Odisha, funded by IPO proceeds, will boost production. With rising global solar energy demand and India's focus on renewables, it is well-positioned for continued growth. However, risks include reliance on US exports and Chinese raw materials.
The company's financial performance has been robust. Revenue rose from Rs 2,854.3 crore in fiscal 2022 to Rs 11,397.6 crore in fiscal 2024, marking year-on-year (YoY) growth of 46.1 per cent, 136.5 per cent, and 68.8 per cent, respectively. EBITDA surged from Rs 111 crore to Rs 1,574.4 crore during the same period, with margins expanding from 3.9 per cent to 13.8 per cent. Net profit grew from Rs 79.7 crore in fiscal 2022 to Rs 1,274.4 crore in fiscal 2024, reflecting a 154.8 per cent YoY increase.
Latest grey market premium (GMP)
In the grey market, Waaree Energies shares were last seen trading at a premium of 100.8 per cent (at Rs 3,018) against its issue price of Rs 1,503 (upper price band). The stock is likely to be listed on October 28.