The company operates with negligible net debt. It is currently in the process of backward integrationwhich is expected to improve the availability of inputs. It also plans to increase solar panel capacity in the future. These initiatives are expected to help the company stay ahead of the competition. Taking these factors into account, the company appears well positioned to take advantage of the rapidly evolving renewable energy landscape in the country. Investors can consider the IPO with a long-term horizon.
Business
The Mumbai-based company started operations in 2007. As of June 2024, it had 12 gigawatts (GW) of aggregate installed capacity compared to 4 GW in FY22. It manufactures a variety of photovoltaic modules, including mono and multicrystalline modules. and contact passivated with tunnel oxide (TopCon). It has four manufacturing facilities spread across Gujarat and one in Uttar Pradesh. Its clients include utilities, enterprises and the retail segment. Export contribution to revenue increased to 57.6% in FY24 from 23% in FY22. The company is in the process of implementing backward integration by establishing capabilities for solar cells and wafers of ingots. For FY27, the capacities of PV modules, solar cells and ingot wafers are expected to be 20.9 GW, 11.4 GW and 6 GW, respectively. Backward integration will help reduce dependence on imports of inputs. At the end of June 2024, the company had a backlog of 16.6 GW of photovoltaic modules and 3.8 GW for its American subsidiary. Finance
Revenue increased to ₹11,397.6 crore from ₹2,854.3 crore between FY22 and FY24, while net profit soared to ₹1,274.4 crore from ₹79.7 crore. Operating margin before depreciation and amortization (Ebitda margin) doubled to 15.6%, while return on equity improved to 30.3% from 17.7% during the period.Valuation
Considering the annualized net profit in the June 2024 quarter, the company is calling for a forward price-earnings (P/E) multiple of 26.9. Another solar panel manufacturer, Premier Energieswhich listed on September 3, is trading at a Forward P/E of 62.3.
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