Waaree Energies IPO: 5 things to know about solar panel maker’s ₹4,321-crore issue

Waaree Energies IPO is scheduled to open for subscription next week on October 21. The solar panel manufacturer aims to raise over ₹4,300 crore through its initial public offering (IPO).

The promoters of the company are Hitesh Chimanlal Doshi, Viren Chimanlal Doshi, Pankaj Chimanlal Doshi and Waaree Sustainable Finance Private Limited. The promoters of the company collectively hold 72.32% stake in the company ahead of the public offer.

Before the opening of the subscription window, here are five key details to know about Waaree Energies IPO:

Waaree Energies IPO offer size, price band, lot size and minimum investment

Waaree Energies has reserved 50% of the net offer for Qualified Institutional Buyers. As much as 35% of the net issue has been set aside for the retail category and 15% of the net issue has been kept aside for the Non Institutional Investor (NII) category.

Retail investors interested in applying for the mainboard issue can place bids for a minimum lot size of 9 shares, which aggregates to an investment of ₹13,527. On the other hand, the minimum lot size for investment for Small Non Institutional Investors (sNII) is 15 lots or 135 shares which amounts to an investment of ₹2,02,905. The lot size for Big Non Institutional Investors (bNIIs) is 74 lots or 666 shares which totals to an investment of ₹10,00,998.

Waaree Energies IPO dates

The IPO subscription is scheduled to open on Monday, October 21. The bidding process will end on Wednesday, October 23. Waaree Energies IPO share allotment status is likely to be finalised on Thursday, October 24. Subsequent to the allotment of shares, refunds will be initiated for unsuccessful bidders on Friday, October 25, and successful bidders will receive shares of Waaree Energies in their Demat accounts on the same day. Waaree Energies shares will be listed on the NSE and BSE. The tentative IPO listing date is October 28.

Waaree Energies: Key financials and competitors

Waaree Energies’ revenue for the quarter ended June 30, 2024, (Q1FY25) stood at ₹3,496.41 crore and the company’s profit-after-tax (PAT) stood at ₹401.13 crore. Its net worth at the end of the June quarter of the current financial year stood at ₹4,471.71 crore.

Waaree Energies’ revenue grew by over 69% to ₹11,632.76 crore in FY24 compared to ₹6,860.36 crore in FY23. The company’s PAT also increased more than 154% to ₹1,274.38 crore in FY24 compared to ₹500.28 crore in FY23. Waaree Energies’s net worth increased over 123% to ₹4,074.84 crore against ₹1,826.02 crore in FY23.

Waaree Energies manufactures components such as solar photovoltaic (PV) modules. The company mentioned in its Red Herring Prospectus(RHP) that its key competitors include companies such as Vikram Solar Ltd, Tata Power Solar, Systems Ltd, Websol Energy Systems Ltd, Mundra Solar PV Ltd and Premier Energies Ltd.

Waaree Energies Business Model

Waaree Energies is a manufacturer of solar PV modules and has an aggregate installed capacity of 12 GW, as of June 30, 2024. The company manufactures solar PV modules using multicrystalline cell technology, monocrystalline cell technology and new technologies such as Tunnel Oxide Passivated Contact (TopCon).

The company also manufactures semi-flexible solar panels for global customers. The company’s sales and revenue channels include direct sales to enterprises. Its international operations include sales to international customers and Engineering, Procurement, and Construction (EPC) revenue from foreign clients. The company also undertakes retail sales through its extensive franchisee network focused on rooftop and MSME customer businesses as well as franchisee EPC revenue. Additionally, the company also provides EPC services for domestic utilities and enterprise customers, Operations and Maintenance (O&M) services, trading in ancillary products, export incentives, generation of electricity from renewable resources and scrap sale.

Waaree Energies IPO: Key strengths and weaknesses

Here’s a look at some key weaknesses of Waaree Energies IPO:

• The company mentioned in its RHP that its export sales make its operations prone to risks and uncertainties of various international markets such as the United States. The company also added that its revenue from operations is highly dependent on export sales.
• Waaree Energies also mentioned in the DRHP that its ability to grow its retail sales in the commercial and industrial, and residential business verticals, depending on the success of its relationship with franchisees and an inability to maintain or further expand its retail network, could negatively impact the business.
• The company also said that a part of its raw materials are imported from China and any restrictions or import duties on raw materials are likely to adversely affect its business prospects.
• The company added that it is heavily dependent on third party suppliers of materials and components for manufacturing products. Any disruption in the supply chain such as fluctuation in component prices could adversely impact the company’s business.

Here’s a look at some key strengths of Waaree Energies

• Waaree Energies is the largest solar PV module manufacturer in India with the largest aggregate installed capacity of 12 GW, as of June 30, 2024.
• The company has a diversified base of global and domestic customers and its leadership position enables it to offer competitive pricing for its products.
• The company added that its retail business has an extensive pan-India network consisting of 369 franchisees as of June 30, 2024.
• The company also said in its RHP that it intends to continue to upgrade the technology in its existing manufacturing facilities, gradually phasing out production of multicrystalline modules and focus on increasing its manufacturing of higher efficiency Mono PERC modules as well as other modules with emerging technology such as TopCon.

About Waaree Energies

Waaree Energies, incorporated in December 1990, is engaged in the manufacturing of solar PV modules. The company has four manufacturing facilities in India, covering a total area of 136.3 acres as of June 30, 2023. The company’s facilities are located in Surat, Tumb, Nandigram, and Chikhli in Gujarat, India. The company employed 1,019 workers on a full time basis as of June 30, 2023.