Waaree Energies Limited listed today, October 28, 2024, on the NSE and BSE at a 66.33% premium, opening at ₹2,500 against the upper IPO price band of ₹1,503. However, following the strong debut, the stock saw a downward adjustment. Waaree’s IPO raised ₹4,321.44 crore, including a Fresh Issue of ₹3,600 crore and an Offer for Sale (OFS) of ₹721.44 crore.

IPO Subscription and Listing Details

Waaree Energies' IPO, open from October 21-23, 2024, received robust demand, with an impressive 76.34 times subscription on the final day. The share price was set at a range of ₹1,427-₹1,503 per share, with retail investors needing a minimum investment of ₹13,527 for one lot (9 shares) and HNIs at ₹2,02,905 for 15 lots (135 shares).

A notable Grey Market Premium (GMP) of ₹1,080 before listing indicated a 72% potential gain, fueled by the company’s solid performance in the renewable energy sector. However, the real-time stock performance post-listing revealed a more tempered demand among investors.

Company Background and Objectives

Waaree Energies Limited ("WEL") is India’s largest solar PV module manufacturer, with a 12 GW installed capacity as of June 30, 2024. The company began operations in 2007 with a focus on producing affordable, sustainable energy solutions, advancing India's renewable energy footprint. The IPO proceeds are primarily allocated towards funding a 6 GW manufacturing facility in Odisha, with ₹2,775 crore earmarked for the project and the remainder for general corporate purposes.

Waaree Energies' management includes seasoned leaders with decades of experience, including Hitesh Chimanlal Doshi (Chairman & Managing Director) and Viren Chimanlal Doshi (Whole-time Director). Their vision centers on expanding Waaree’s market dominance in solar energy production, addressing the growing demand for sustainable energy sources.

Financial Performance and Valuation

The company has reported steady financial growth, with revenue of ₹1,16,327.63 million in FY24, significantly up from ₹68,603.64 million in FY23. The EBITDA and PAT for FY24 were ₹18,095.77 million and ₹12,737.71 million, respectively. With a pre-issue EPS of ₹47.86 and a post-issue EPS of ₹43.06, Waaree Energies’ P/E ratios stand at 31.40x pre-issue and 34.90x post-issue. This compares favorably with the industry average of 151.13x, suggesting the IPO was competitively priced for its sector.

Investor Insights and Recommendation

While Waaree Energies’ listing began with a strong premium, the stock’s correction reflects investor caution. Waaree’s long-term growth potential in the renewable energy sector, coupled with its robust financial performance, makes it appealing for high-risk investors aiming for listing gains or long-term positions in solar energy.

Investors can check IPO allotment status through the registrar’s website by selecting Waaree Energies IPO from the dropdown and entering relevant details.

Recommendation:
Waaree Energies offers high growth potential, particularly for risk-seeking investors interested in solar energy. However, given the current market volatility, long-term investors should carefully assess market conditions before committing to long-term positions.

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