Premier Energies IPO has been listed on the stock market. Today the company’s IPO has opened for investors. Investors can bid in this IPO till 29 August. This IPO will be listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on 3 September.
How much price band has been fixed
- Premier Energies Limited is trying to raise Rs 2,830.40 crore from the market through this IPO.
- In this, the company has issued fresh shares worth Rs 1,291.40 crore.
- At the same time, Rs 1,539 crore is going to be raised under Offer for Sale. A total of 6,29,09,198 shares have been offered in this Premier Energies IPO.
- The face value of the company’s shares is Rs 1 per share. At the same time, its price band has been fixed between Rs 427 to Rs 450 per share.
- A discount of Rs 22 per share has been kept for the employees of the company.
- Kotak Mahindra Bank, JP Morgan India, and ICICI Securities are the book-running lead managers of the IPO.
Know the important dates related to the Premier Energies IPO
- IPO opening date – Tuesday, August 27
- IPO closing date – Thursday, August 29
- Date of allotment of shares – Friday, August 30
- Date of receiving a refund – Monday, September 2
- Date of crediting shares in demat account – Monday, September 2
- Listing date – Tuesday, September 3
How much has been subscribed so far?
According to the website of the National Stock Exchange (NSE), till 12.54 pm, the Premier Energies IPO was subscribed a total of 0.49 times. In this, retail investors bid 0.63 times, and non-institutional investors bid 0.74 times. Apart from this, the employees of the company have bid 1.43 times. However, QIB investors have not placed any bids yet.
What does the brokerage say
Brokerage firm Reliance Securities has recommended subscribing to the issue. The brokerage said that Premier Energies has a long track record in the solar module manufacturing sector and experience in solar cell production with 2.0 GW annual installed capacity, representing 28% of India’s total capacity in FY24. The company has a diversified customer base with customer relationships in India and abroad. It has a strong order book of Rs 5,926 crore. The company has maintained consistent profitability over the past few years.
Anand Rathi
Anand Rathi analysts believe that the company can remain in a better position going forward due to its strong market position, good customer base and technical expertise. Therefore, the brokerage has given the IPO a ‘Subscribe – Long Term’ rating. The brokerage said, “The company’s P/E ratio is 87.7 times based on FY24 earnings, however if we annualize FY25 earnings, the P/E ratio comes down significantly to 25.5 times. Its market cap-to-sales ratio is 6.4 times based on FY24 earnings.”
Mehta Equities
Mehta Equities has advised to subscribe to the IPO for the long-term. Rajan Shinde of Mehta Equities said that Premier Energies gives investors an opportunity to invest in India’s second largest integrated solar cell and module manufacturing company. Shinde said that with a strong annual capacity of 2 GW for solar cells and 4.13 GW for modules, the company is well positioned to capitalize on the growing demand for renewable energy. Its listing gain can reach more than 25% of the issue price.
What is the gray market premium?
Premier Energies IPO is commanding a tremendous premium in the gray market. Its price was quoted at Rs 808 in the gray market this morning. If its upper price band is considered as the price, then at present a premium of Rs 358 is being offered on each share. A day before this, its GMP was 74.67% i.e. ₹ 336 per share.
How much reservation for whom
50% of this public issue is reserved for Qualified Institutional Buyers (QIB). Apart from this, 35% is reserved for retail investors and the remaining 15% is reserved for non-institutional investors (NII).
Loss in FY22 and FY23
The company’s revenue and EBITDA growth have been good. The company’s revenue has quadrupled since FY22. Revenue has grown by 100 percent in each of the last two years. However, its operating margin has fluctuated significantly. It was in a net loss in FY22 and FY23. However, its EBITDA and profit margin have increased in the last 18 months due to increased manufacturing capacity.
Who are the rival companies?
India ranks third in the world in terms of solar module manufacturing. Only China and Vietnam are above it. The installed capacity of solar modules in India is 72 GW. Waaree Energies has a very strong position in the Indian market. Its capacity is 12.5 GW. Premier Energies ranks fifth in solar modules. Apart from Waaree, Mundra Solar, Renew Power and Vikram Solar are above it.
Should you invest?
Premier Energies has a good execution record. It is trading at a PE of 36 times its estimated earnings in FY25. The company is expanding its manufacturing capacity. There is a good possibility of growth in the renewable space in the medium term. However, there is more supply in the domestic sector and competition from China is also being faced, which is a matter of concern. Recently, many stocks have been listed at a premium. In such a situation, investors can invest in this Premier Energies IPO for listing gains.
What does the company do
Premier Energies Limited was established in April 1995. The company manufactures integrated solar cells and solar panels. The company’s product portfolio includes cells, solar modules, monofacial modules, bifacial modules, EPC solutions, and O&M solutions. The company has 5 manufacturing facilities, all located in Telangana. The company also exports solar cells. The company’s customers include NTPC, Tata Power Solar Systems Ltd, Panasonic Life Solutions Pvt Ltd, Continuum, Shakti Pumps, First Energy, Bluepine Energies Pvt Ltd, Luminous and Heartek Solar Pvt Ltd.
Where is the cell exported?
Premier Energies sells its products in the country as well as exports them to the US, Hong Kong, South Africa, Bangladesh, Norway, Nepal, France, Malaysia, Canada, Sri Lanka, Germany, Hungary, United Arab Emirates, Uganda, Turkey, South Korea, China, Taiwan and the Philippines.
