The initial public offering (IPO) of Premier Energies, valued at ₹2,830.40 crore, is set to open for subscription on Tuesday, August 27. This mainboard IPO aims to raise funds through a combination of a fresh issue and an offer for sale.
1. Important Dates for Premier Energies IPO
The IPO will be available for subscription from Tuesday, August 27, until Thursday, August 29. The allotment of shares is expected to be finalised by Friday, August 30, and the company’s shares are likely to be listed on the BSE and NSE on Tuesday, September 3. Refunds for those who do not receive shares should be processed by Monday, September 2.
2. Premier Energies IPO Overview
The Premier Energies IPO consists of a fresh issue of 2.87 crore shares worth ₹1,291.40 crore and an offer for sale of 3.42 crore shares worth ₹1,539.00 crore. This results in a total IPO size of ₹2,830.40 crore.
3. IPO Registrar and Lead Managers
KFin Technologies is the registrar for the Premier Energies IPO, while Kotak Mahindra Capital Company, JP Morgan India Private Limited, and ICICI Securities are the book-running lead managers.
4. IPO Price Band and Minimum Investment
The price band for the Premier Energies IPO is set between ₹427 and ₹450 per share, with a face value of ₹1 per share. The minimum lot size is 33 shares, meaning retail investors will need to invest at least ₹14,850 to participate.
5. Purpose of the IPO
Premier Energies plans to use the funds raised from the IPO to invest in its subsidiary, Premier Energies Global Environment Private Limited. The investment will help finance a new 4 GW Solar PV TOPCon Cell and 4 GW Solar PV TOPCon Module manufacturing facility in Hyderabad. A portion of the funds will also be allocated for general corporate purposes.
6. Business Overview
Premier Energies specialises in manufacturing integrated solar cells and solar modules. According to its Red Herring Prospectus (RHP), the company operates five manufacturing facilities in Hyderabad, with an annual capacity of 2 GW for solar cells and 4.13 GW for solar modules.
7. Industry Outlook
The long-term growth prospects for the renewable energy sector are strong. The company’s RHP states that by 2050, about 75% of electricity will be generated from renewable sources. In India, renewables accounted for 20.7% of electricity generation in FY24, and the country aims to meet 50% of its energy needs from renewable sources by 2030, as pledged during COP-26.
8. Financial Performance
Premier Energies has shown consistent growth in its revenue from operations since FY22. The company’s revenue grew from ₹7,428.71 million in FY22 to ₹31,437.93 million in FY24. For Q1 FY25, the revenue was ₹16,573.67 million, compared to ₹6,110.23 million in the same period last year. After recording a loss of ₹143.60 million in FY22, the company saw a profit of ₹2,313.60 million in FY24. For Q1 FY25, profit stood at ₹1,981.60 million, up from ₹313.29 million in Q1 FY24.
9. Key Risks
According to the RHP, Premier Energies’ revenue is heavily dependent on a few key customers, and the company’s future relies on the success of its solar cells and modules. Additionally, the company has significant working capital needs.
10. Grey Market Premium (GMP)
The grey market premium (GMP) for the Premier Energies IPO was last reported at ₹336. This suggests that the stock could list at around ₹786, which is 74.67% higher than the upper price band of ₹450.
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