Waaree Energies IPO to open for subscription on October 21; Check out 10 key things to know from RHP

Waaree Energies IPO: The initial public offering of Waaree Energies, based in Mumbai, is scheduled to launch on D-Street on Monday, October 21 and close on Wednesday, October 23. The price band for the Waaree Energies IPO will be revealed on October 16, which is tomorrow. The allocation to anchor investors for the Waaree Energies IPO is scheduled to take place on Friday, October 18.

On September 23, 2024, Waaree Energies received approval from the Securities and Exchange Board of India (SEBI). The company, which manufactures solar PV modules, submitted its draft red herring prospectus (DRHP) to SEBI in December of the previous year to secure funding through an IPO.

The company plans to raise up to ₹3,600 crore through an initial public offering by issuing fresh equity shares. Additionally, there will be an offer for sale of up to 4,800,000 equity shares with a face value of ₹10 each.

Promoter Waaree Sustainable Finance Private Ltd and shareholder Chandurkar Investments Pvt Ltd are selling the OFS shares, as mentioned in the Red Herring Prospectus (RHP).

The book running lead managers for the Waaree Energies IPO include Axis Capital Limited, Iifl Securities Ltd, Jefferies India Private Limited, Nomura Financial Advisory And Securities (India) Pvt Ltd, SBI Capital Markets Limited, Intensive Fiscal Services Private Limited, and Iti Capital Ltd. Additionally, Link Intime India Private Ltd is serving as the registrar for the issue.

Here are 10 key things from the RHP that investors might want to know before subscribing to the issue.

Waaree Energies IPO Promoters

The individuals promoting the company are Hitesh Chimanlal Doshi, Viren Chimanlal Doshi, Pankaj Chimanlal Doshi, and Waaree Sustainable Finance Private Limited. As of the RHP date (October 14), Hitesh Chimanlal Doshi possesses 14,104,082 equity shares, Viren Chimanlal Doshi possesses 10,954,007 equity shares, Pankaj Chimanlal Doshi possesses 24,604,384 equity shares, and Waaree Sustainable Finance Private Ltd possesses 57,117,331 equity shares. These shares represent 5.36%, 4.16%, 9.34%, and 21.69%, respectively, of the pre-Offer issued, subscribed, and paid-up equity share capital of their company.

Waaree Energies IPO Peers

The company's listed peers are Websol Energy System Ltd, and Premier Energies Ltd (with a P/E of 151.13).

Waaree Energies Business

As per the CRISIL report as of June 30, 2024, the company has emerged as the foremost manufacturer of solar PV modules in India, with a remarkable total installed capacity of 12 GW.

From 2007 onwards, the company has been committed to producing solar PV modules with the goal of providing cost-effective, top-notch sustainable energy solutions in various markets and contributing to the reduction of carbon emissions, thereby promoting sustainable energy and improving the overall quality of life.

Waaree Energies Subsidiaries

The firm has twelve direct subsidiaries and three step-down subsidiaries. Waaree Energies' subsidiaries are Waaree Clean Energy Solutions Private Ltd, Waaree Power Private Ltd, Waaneep Solar One Private Ltd, Sangam Solar One Private Ltd, Waaree Energy Storage Solutions Private Ltd, Waaree Forever Energies Private Ltd, Waaree Green Aluminium Private Ltd, Rasila International Pte Ltd, Waaree Renewable Technologies Ltd, Waaree Solar Americas Inc, Indosolar Ltd, and Waaree Energies Middle East FZE. Additionally, the company's step-down subsidiaries include Waasang Solar One Private Ltd, Sunsational Solar Private Ltd, and Sunsantional Energy Private Ltd.

Waaree Energies Manufacturing Facilities

The firm has five manufacturing facilities in India, covering a total area of 143.01 acres. These facilities include the Surat Facility, Tumb Facility, Nandigram Facility, and Chikhli Facility in Gujarat, India, as well as the IndoSolar Facility in Noida, Uttar Pradesh.

Waaree Energies Products Portfolio

The following PV modules are included in the solar energy product portfolio: building-integrated photovoltaic (BIPV) modules, flexible bifacial modules (Mono PERC), both framed and unframed, and monocrystalline and multicrystalline modules.

Waaree Energies Financials

Waaree Energies Limited experienced a 70% growth in revenue and a 155% surge in profit after tax (PAT) between the financial years ending on March 31, 2024, and March 31, 2023.

Waaree Energies IPO key risks

Some of the key risks are as follows;

-The company relies on specific major clients, and if any of these clients are lost or if revenue from sales to any major clients decreases, it could significantly harm their business, financial status, operating results, and cash flow.

-The growth of the company's retail sales, especially in the commercial and industrial as well as residential sectors, relies heavily on the effectiveness of their partnership with franchisees. If they are unable to sustain or extend their retail network, it could have adverse effects on their business, cash flows, and operational outcomes.

Lock-in of equity shares allotted to anchor investors

The anchor investor portion will have a lock-in period for any equity shares allotted to anchor investors. This lock-in period will include 50% of the allotted equity shares for 90 days from the date of allotment, and the remaining 50% for 30 days from the date of allotment for each of the anchor investors.

Significant factors affecting results of operations and financial condition

The significant factors which can affect the company's results of operations and financial condition are as follows: such as their capacity expansion and backward integration plans; increase in export sales; regulatory and policy developments; movement in the price of solar PV modules; cost of materials consumed for the manufacture of their products; relationship with key customers; growth in their retail network of franchisees; import restrictions and import duties; competition with other players in or industry; and exchange rate fluctuations.

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