IPO listed on 28 Oct'24
Waaree Energies Ltd
Minimum Investment
₹ 13,527 / 9 shares
Grey market premium
₹ 1,375 (91% premium)
Issue price
₹ 1503
Listing price
₹ 2,500
Listing gains
997 (66%)
Listing on
Oct 28, 2024
Our Verdict:
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- Waaree Energies Ltd (Waaree) has shown impressive revenue and EBITDA growth in recent years, with its turnover increasing nearly six-fold since FY21 to over Rs 11,000 crore, driven by favourable government policies. Scale and operational efficiencies have significantly boosted EBITDA and net profit margins.
- In terms of valuations, the IPO seems reasonably priced with a price-to-earnings (P/E) ratio of 31x based on FY24 earnings. Additionally, the hefty grey market premium (GMP) for the issue suggests a solid market debut on the bourses.
- Despite concerns about a domestic supply surplus and competitive pressures from Chinese manufacturers, Indian firms benefit from various levels of government protection. As the largest solar PV module producer in India, Waaree stands to gain significantly from the booming solar energy sector.
- Given the fair valuations, impressive growth metrics, strategic expansion initiatives and strong industry tailwinds, investors may consider subscribing to this IPO from a medium-to-long term perspective.
About the company
Founded in
18 Dec'90
Managing director
Hitesh Doshi
- Waaree is India’s largest solar PV module manufacturer, with 13.3 GW capacity across Gujarat and Uttar Pradesh. It is now expanding internationally by setting up a 1.6 GW solar PV module facility in Texas (USA) to benefit from US Inflation Reduction Act incentives.
- Waaree has also been awarded a solar PLI for a 6 GW integrated manufacturing facility, which will boost its total capacity to over 20 GW in 2-3 years. Domestically, it is building a 5.4 GW solar cell facility in Gujarat to strengthen supply chains and margins, set to be operational by year-end.
STRENGTHS
- Market Leadership: Waaree holds the distinction of being India's largest solar PV module manufacturer, with an unmatched installed capacity of 12 GW as of June 30, 2024. In FY24, it ranked second in operating income among all Indian solar PV module manufacturers.
- Exceptional Financial Growth: Waaree has demonstrated significant growth, with its operational revenue and net profit achieving compounded annual growth rates (CAGRs) of 100% and 300%, respectively, from FY22 to FY24.
- Solid Return Ratios: Waaree’s financial efficiency is highlighted by impressive return metrics, with a Return on Equity (RoE) of 30.26% and a Return on Capital Employed (RoCE) of 26.29% in FY24.
- Increasing Profitability: Over recent years, Waaree has consistently improved its EBITDA and Net Profit margins, which stood at 15.56% and 10.96%, respectively, as of March 31, 2024.
- Robust Order Book: As of June 30, 2024, Waaree maintained a robust order book, with pending orders totaling 16.66 GW for solar PV modules and an additional 3.75 GW from its US subsidiary, Waaree Solar Americas Inc.
- Strong Industry Tailwinds: Following post-Covid disruptions, India’s solar module manufacturing has surged due to government initiatives like the PLI scheme, Pradhan Mantri KUSUM and Suryodaya Yojana. Solar capacity has tripled in the last 6 years, reaching 87.2 GW by July.
RISK FACTORS
- Client Concentration: Waaree’s revenue concentration is high, with its top 1, 5, and 10 customers representing 9%, 40%, and 57% of its operational revenue as of FY24, respectively. This dependency on a limited number of clients exposes the company to significant risk if there is a reduction or delay in orders.
- Geographical Concentration: With four out of five of Waaree's operational manufacturing facilities located in Gujarat, the company is susceptible to risks associated with local and regional factors that could hinder operations and negatively impact business performance and cash flows.
Financials
All Values are in Cr.
Issue details
Issue type
Mainstream
Issue size
₹ 4,321.44 crore
Fresh Issue
₹ 3,600 crore
OFS
₹ 721.44 crore
Price range
₹ 1,427 - 1,503
Lot size
9 shares
Issue Objective
Waaree intends to use the net proceeds from the fresh issue for the following purposes:
- Partially finance the development of a 6 GW Ingot Wafer, Solar Cell, and Solar PV Module manufacturing facility in Odisha; and
- General corporate purposes.
Dates
Bidding open
21 Oct'24
Bidding close
23 Oct'24
Allotment date
24 Oct'24
Refund date
25 Oct'24
Listing
28 Oct'24
IPO Reservations
Qualified institutional buyers
<50%
Non-institutional investors
>15%
Retail individual investors
>35%
Read the Offer Document
© 2025 by Liquide Solutions Private Limited, SEBI Registered Research Analyst (Registration number - INH000009816)
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