Fujiyama Power Systems files IPO papers, plans Rs 700-crore fresh issue for expansion, debt reduction

Fujiyama Power Systems IPO

Uttar Pradesh-based solar energy solutions provider Fujiyama Power Systems has filed draft papers with capital markets regulator SEBI to raise funds via initial public offering for expansion and debt reduction purposes.

The IPO will be a mix of fresh issuance of equity shares worth Rs 700 crore, and an offer-for-sale of 2 crore equity shares by existing shareholders. Promoters Pawan Kumar Garg and Yogesh Dua will sell 1 crore shares each via offer-for-sale.

It may consider raising funds up to Rs 140 crore before the IPO launch. If it completes the said pre-IPO placement, the fresh issue size will be reduced to the extent of such amount.

With three manufacturing facilities (in Greater Noida, Haryana, and Himachal Pradesh), the company makes products and solution for the roof-top solar industry, intending to excel in solar panel, solar inverter, and both lead acid and lithium-ion battery production under its UTL Solar, and Fujiyama Solar brands. Since FY22, it has sold 1.2 million (458.14 MW) solar panels, 0.6 millon (1,065.83 MW) solar inverters and 0.85 million (1,672.17 MWh) batteries.

Further, in the EV segment, it also provides chargers for three-wheeler electric autorickshaws (E-rickshaws) and lithium-ion batteries.

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Fujiyama Power Systems is also in the process of developing a new facility for manufacturing solar panel in Dadri, Uttar Pradesh and installation of another solar inverter and lithium-ion battery line in Greater Noida facility.

Apart from that, it plans to use Rs 250 crore out of net fresh issue proceeds for establishing manufacturing facility for solar inverter, solar panels and lithium-ion batteries in Ratlam, Madhya Pradesh. This will result into increase in company's current manufacturing capacity to at least two-fold.

Further, IPO proceeds of Rs 300 crore will be utilised for repaying debt, which will help the company to become almost debt free. As of November 2024, it had an outstanding borrowing of Rs 301.2 crore.

Also read: Funding winter to IPO frenzy: How Indian startup ecosystem went back on the boil in 2024

On the financials front, Fujiyama Power that competes with listed peers like Waaree Energies, Premier Energies, Exicom Tele Systems, and Insolation Energy has recorded net profit at Rs 45.3 crore for the year ended March 2024, growing 86 percent compared to Rs 24.4 crore in the previous fiscal. Revenue in the fiscal 2024 increased by 39.2 percent to Rs 924.7 crore, compared to Rs 664 crore in the previous year.

The company in H1FY25 already surpassed its previous full year profit, reporting profit for six months period ended September 2024 stood at Rs 75 crore on revenue of Rs 721.7 crore.

Motilal Oswal Investment Advisors, and SBI Capital Markets are appointed as the merchant bankers for the issue.