Waaree Energies IPO: GMP, date, price, risks and outlook. All the details

Waaree Energies Ltd., India’s largest solar module manufacturer, is preparing to launch its initial public offering (IPO) on October 21, with anchor bidding starting October 18. The three-day public subscription will close on October 23. Waaree aims to raise ₹4,321.4 crore, including a fresh issue of ₹3,600 crore through 2.39 crore equity shares and an offer-for-sale worth ₹721 crore by promoters. The price band for the shares is set between ₹1,427 and ₹1,503, valuing the company at ₹43,179 crore at the upper end.

The IPO has already generated significant interest, with shares in high demand in the grey market. The grey market premium (GMP) for Waaree Energies stood at ₹1,565, indicating a 105% premium over the issue price. This suggests strong investor sentiment, though it's important to note that GMPs are subject to change and reflect unlisted market activity rather than official trading.

The IPO allocation includes 50% reserved for qualified institutional buyers, 15% for non-institutional investors, and 35% for retail investors. Post-listing, shares will be available on both the NSE and BSE.

Founded in 1990, Waaree Energies leads the Indian solar module manufacturing sector with an installed capacity of 12 gigawatts and a 20% domestic market share as of fiscal 2024. The company operates four manufacturing plants in Gujarat and holds an order book of 16.66 GW, including 3.75 GW of orders for its U.S. subsidiary, Waaree Solar Americas Inc.

Proceeds from the IPO will primarily finance a new 6 GW ingot wafer, solar cell, and PV module manufacturing facility in Odisha, with ₹2,775 crore to be deployed over the next three fiscal years. The total cost of the project is estimated at ₹9,050 crore.

Waaree's financial performance has been robust. Revenue rose from ₹2,854.3 crore in fiscal 2022 to ₹11,397.6 crore in fiscal 2024, marking year-on-year growth of 46.1%, 136.5%, and 68.8%, respectively. EBITDA surged from ₹111 crore to ₹1,574.4 crore during the same period, with margins expanding from 3.9% to 13.8%. Net profit grew from ₹79.7 crore in fiscal 2022 to ₹1,274.4 crore in fiscal 2024, reflecting a 154.8% year-on-year increase.

Risks and outlook

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, Waaree is well-positioned for continued growth. However, risks include reliance on U.S. exports and Chinese raw materials. Nonetheless, Waaree’s expanding footprint and financial strength suggest a positive trajectory.