Waaree Energies IPO : 7 things to know about

Waaree Energies Ltd IPO

by 5paisa Research Team Last Updated: 2022-12-09T09:37:11+05:30

Waaree Energies Ltd, which is India’s largest solar module manufacturer, had applied for a Rs.1,500 crore IPO and the approval has already come in the second week of January 2022. However, the company is yet to firm in on the date of the IPO and perhaps it is waiting for the IPO markets to settle down and also the LIC IPO to be done with. The DRHP had been filed with SEBI in September 2021 and it is a combination of fresh issue and an offer for sale, with a total issue size of approximately Rs.1,500 crore.

7 Important things to know about Waaree Energies IPO

1) Waaree Energies Ltd has filed for a Rs.1,500 crore IPO with SEBI which comprises of a fresh issue of Rs.1,350 crore and an offer for sale of OFS of approximately Rs.150 crore. The company will offer a total of 40,07,500 equity shares under the offer for sale (OFS) by early investors and the promoters of the company. 

2) As part of the overall issue process, Waaree Energies is also planning to do a pre-IPO placement of Rs.270 crore ahead of the IPO. If the pre-IPO placement is successful, then the size of the final issue will be reduced proportionately. The reduction of the issue size for Waaree Energies IPO will be done from the fresh issue component of the issue.

3) Waaree Energies  will use the proceeds of Rs.1,500 crore from the fresh issue portion mainly for expanding its operations. To get into specifics, the company has allocated a sum of Rs.910.31 crore towards the solar cell manufacturing unit while a sum of Rs.141.24 crore has been allocated for the solar module facility.

The balance of the fresh issue proceeds will be used for working capital purposes and to partially take care of general corporate expenses of the company.

4) Waaree Energies Ltd is a predominant player in the solar energy industry in India. It principally operates in the area of photovoltaic (PV) module manufacturing. The PV cells are the ones that translate the solar power into usable energy.

The company currently has an installed capacity of 2GW. Its manufacturing facilities are currently spread across factories located at Surat, Tumb and Nandigram. Waaree Energies is currently in the process of setting up one more manufacturing facility at Chikhli in the state of Gujarat. At this location, Waaree Energies will implement capacity expansion as well as facilities for backward integration into solar cell manufacturing.

5) The PV manufacturing industry is a competitive segment with a lot of players trying to make a mark in this fast growing and futuristic segment. It is also attractive due to the various incentives that the government offers to these segments.

Some of its key competitors in this field are Vikram Solar Ltd, Mundra Solar Ltd (part of Adani Group), Premier Energies Ltd, EMMVEE Photovoltaic Ltd and Alpex Solar. This is a segment that is also seeing the entry of large established players in a big way.

6) Waaree Energies currently has a mix of domestic and international clients for its alternate energy business. For example, some of its major clients include ReNew Power, ACME, Hero Solar Ltd, Mahindra Susten, Essel Infra, AMP Energy, Solar World Energy, Rays Power Infra etc.

Some of its global clients include well-known names like Central 40 and Novel Energy. Over the years, the company has built a strong brand and deep relationships with domestic and international clients in this niche business.

7) The IPO of Waaree Energies Ltd will be lead managed by Axis Capital, HSBC Securities, ICICI Securities and Intensive Fiscal Services Private Ltd. They will act as the book running lead managers or BRLMs to the issue.

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