With an upper price band of Rs 450, the stock is expected to trade at a premium of over 100%, which could lead to multibagger returns for investors who received allotments in the IPO.
However, it is important to note that grey market premiums are only one indicator of how a company’s shares compare in the over-the-counter market and are subject to change rapidly.
Premier Energies’ IPO received a solid response from investors with a 74 times subscription at closing, driven by strong bids from non-institutional investors.
The company proposes to use the net proceeds for investment in its subsidiary, Premier Energies Global, to partially fund the establishment of a 4 GW TOPCon solar PV cell and 4 GW TOPCon solar PV module manufacturing facility in Hyderabad, and the remainder for general corporate purposes. Premier Energies was India’s second-largest integrated player at the end of FY24, with 2 GW of annual installed capacity for cell manufacturing along with its 4.13 GW of annual installed capacity for module manufacturing. It is the largest Indian exporter of solar cells to the US in FY24. As of the date of filing of the RHP, the company has five manufacturing facilities located in Hyderabad and operates through eight subsidiaries in India and abroad. India’s module manufacturing capacity reached approximately 72 GW by FY24 and while its current solar cell manufacturing capacity stands at 8.1 GW, it is also poised for exponential growth in the future.
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The company’s revenue from operations grew at a compound annual growth rate (CAGR) of 42.71% between FY21 and FY23. Its FY24 revenue grew 120% to Rs 3,143 crore. The company posted a profit of Rs 231 crore in FY24, against a loss of Rs 13.3 crore a year ago.
Kotak Investment Banking, JPMorgan and ICICI Securities are acting as lead managers for the issue.
(Disclaimer: The recommendations, suggestions, views and opinions of the experts are their own and do not represent the views of The Economic Times)
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