Waaree Energies Ltd IPO

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IPO Synopsis

IPO Synopsis
Waaree Energies filed preliminary papers with SEBI to raise funds via an initial public offering.
The issue includes a fresh issue of equity shares worth Rs 1,350 crore as well as an offer for sale of 40,07,500 equity shares by existing shareholders and promoters. Each equity share holds a face value of Rs. 10.
For financial year 2020-2021, Waree’s revenue from operations stood at Rs 1,952.78 crore against Rs 1,995.78 crore a year ago. Net profit came in at Rs 48.19 crore, up from Rs 39.02 crore a year ago.
Axis Capital, HSBC Securities and Capital Markets, ICICI Securities and Intensive Fiscal Services are the merchant bankers to the issue.

Objective of the Issue

The proceeds from its fresh issuance will be used to 
1.    finance the cost of setting up a 2 gigawatt (Gw) per annum solar cell manufacturing unit and a 1 Gw solar PV module manufacturing facility in Degam village, Chikhli, Gujarat
2.    general corporate purposes
 

About Waaree Energies Ltd

Waaree Energies is one of the major players in the solar energy industry focused on PV module manufacturing, with an aggregate installed capacity of 2 GW. Its vision is s to provide quality, cost-effective sustainable energy solutions across markets, and aid in reducing carbon foot-print paving way for sustainable energy. The company currently operates three manufacturing facilities comprising four factories in India at Surat, Tumb and Nandigram.
It is also in the process of setting up another manufacturing facility at Chikhli (“Chikhli Facility”) in Gujarat, India where its implementing capacity expansion plans for PV modules as well as setting up of facilities for backward integration into solar cell manufacturing. The addition of 3 GW PV module manufacturing capacity to the existing 2 GW capacity, is expected to be operational by the end of FY22, and the 4 GW solar cell manufacturing capacity is expected to be operational by the end of FY23.
Its expansion strategy includes executing regular capacity additions, as well as continuous upgradation 166 of its manufacturing technology and processes driven by demand with a focus on incorporating Mono PERC and large sized silicon wafers technology as well as other new emerging technologies.
Some of the key clients or customers in the domestic utility and enterprise segment include ReNew Power, ACME, Hero Solar, Mahindra Susten, Essel Infra, AMP Energy, Sukhbir Agro Energy, Solarworld Energy, Rays Power Infra. On a global stage customers come from across geographies, including customers in the United States, Canada, Italy, Turkey and Vietnam. Key international clients include Central 40 and Novel Energy.
 

Financials

Particulars (in Rs. Crores)

FY21

FY20

FY19

Revenue

195.28

199.58

159.10

EBITDA

12.54

11.78

16.54

PAT

4.92

4.17

8.23

EPS (basic in Rs.)

2.5

2.12

4.18

ROE

14.28%

14.01%

32.11%

ROCE

18.43%

22.71%

23.23%

 

Particulars (in Rs. Crores)

FY21

FY20

FY19

Total Assets

128.05

93.83

81.86

Share Capital

19.71

19.71

19.71

Total Borrowings

28.96

12.56

10.70

 

Particulars (in Rs. Crores)

FY21

FY20

FY19

Net cash generated from / (used in) operating activities

67.28

83.24

105.39

Net cash from / (used in) investing activities

-249.69

-22.34

16.09

Net cash flow from / (used in) financing activities

161.33

-49.78

-105.75

Net increase (decrease) in cash and cash equivalents

-21.08

11.12

15.73


The key points are- 

Key Points

  • Strengths

    1.    Leading solar PV module manufacturer in India well positioned to capture strong industry tailwinds and growth prospects for solar energy
    2.    Marquee customer base in India and globally
    3.    Deep penetration into the rooftop segment through the pan-India franchisee network
    4.    High quality manufacturing with stringent quality control and global accreditations
     

  • Risks

    1.    Any decrease in demand for solar power products or change in governmental policies
    2.    Restrictions on or import duties relating to materials and equipment imported for the manufacturing operations as well as restrictions on or import duties levied on the products in the export markets
    3.    Disruptions in the supply or availability of materials and components of the appropriate quality standards and fluctuation in their prices obtained from third party suppliers
    4.    Implementing growth strategy requires significant capital expenditure 
    5.    Business is dependent on the regulatory and policy environment affecting the renewable energy sector in India
    6.    Any noncompliance may lead to, amongst others, accelerated repayment schedule and suspension of further drawdowns
     

How to apply for an IPO?

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  • Enter the number of lots and price at which you wish to apply for

  • Enter your UPI ID and click on submit. With this, your bid will be placed with the exchange

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  • Approve the mandate request on your UPI and funds will be blocked

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