Waaree Energies' initial public offering (IPO), valued at ₹4,321 crore, saw an impressive start on October 21. Within the first hour of bidding, the issue was already subscribed 50%, reflecting strong investor interest. This rapid uptake drew bids for 1.08 crore shares out of the 2.1 crore on offer, according to exchange data.
Investors looking to invest in IPO offerings will find Waaree Energies' debut particularly noteworthy.
A major player in solar energy
Waaree Energies has established itself as a key player in the solar energy industry. The company specialises in photovoltaic (PV) module manufacturing and has an aggregate installed capacity of 12 GW as of June 30, 2023. For those seeking to invest in IPOs linked to green energy, Waaree Energies presents an appealing prospect.
Non-institutional investors lead the way
On day 1, the non-institutional investor (NII) portion of the IPO was fully subscribed, with bids 1.16 times the shares available. Retail investors had also shown significant interest, with 54% of the shares reserved for them being booked by early trading hours. In comparison, the employee quota was subscribed to 23%, while Qualified Institutional Buyers (QIBs) had not yet significantly participated in the bidding process. Those considering how to invest in IPO markets may take note of the strong demand from non-institutional investors.
Grey market premium boosts interest
Ahead of the IPO's official opening, Waaree Energies gained significant attention in the grey market, with its premium crossing the 100% mark. This reflects growing optimism among market participants and further drives interest in those looking to invest in IPOs.
Details of the Waaree Energies IPO
The IPO includes a fresh issue of equity shares valued at ₹3,600 crore, as well as an offer-for-sale (OFS) of 48 lakh shares by promoters and existing shareholders, which amounts to ₹721.44 crore. This takes the total issue size to ₹4,321.44 crore. For investors planning to invest in IPO opportunities, Waaree Energies offers a combination of fresh capital and existing shareholder offload.
Use of IPO proceeds
The proceeds from the IPO will primarily be allocated towards the development of a 6 GW manufacturing facility in Odisha. This new facility will focus on producing ingot wafers, solar cells, and solar PV modules. Additionally, part of the funds will be used for general corporate purposes. For those looking to invest in IPOs within the renewable energy space, this expansion plan enhances the company's appeal.
Waaree Energies' manufacturing footprint
Currently, the company operates five manufacturing facilities across India. These are located in Surat, Tumb, Nandigram, and Chikhli in Gujarat, as well as the IndoSolar facility in Noida, Uttar Pradesh. For investors aiming to invest in IPOs with a focus on domestic manufacturing capabilities, Waaree Energies presents a robust operational framework.
Final thoughts
With the Waaree Energies IPO off to a strong start, many investors may be keen to explore opportunities to invest in IPOs within the renewable energy sector. The company's expansion plans, growing demand, and favourable market conditions make it a significant offering for those who wish to invest in IPO markets.
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