The initial public offering of Solarworld Energy Solutions continued to see strong investor interest on its second day of public bidding, September 24. The IPO has been subscribed 4 times its offer size so far.
The maiden public issue of the company received bids for 3.23 crore shares, as against the offer size of around 81 lakh shares, according to data on NSE. Retail investors' portion has been subscribed 13.63 times, while Non Institutional Investors (NII) portion got booked 5.53 times. Qualified Institutional Buyers (QIB) have subscribed to 2 percent of their reserved portion.
Solarworld Energy Solutions IPO GMP:
Ahead of listing, the unlisted shares of Solarworld Energy Solutions were trading with nearly 16 percent grey market premium (GMP) over the IPO price, according to data on Investorgain. This is slightly lower than the 19.37 percent GMP quoted by the site during the weekend, but higher than the 9 percent quoted last week.
According to IPO Watch, the unlisted shares of the company were trading with 18.80 percent GMP over the IPO price.
Key details about Solarworld Energy Solutions IPO:
Solarworld Energy Solutions launched its IPO to raise Rs 490 crore from the capital markets through a fresh issue of Rs 440 crore and an offer for sale (OFS) of shares worth Rs 50 crore by promoter Pioneer Facor IT Infradevelopers. The price band for the IPO has been set at Rs 333-351 per share.
Investors can bid for a minimum of 42 shares, requiring an investment of Rs 14,742 at the upper price band, and in multiples thereafter. The share allotments will likely be finalized by September 26, and the shares are scheduled to be listed on stock exchanges on September 30.
Solarworld Energy Solutions will spend Rs 420 crore of the fresh issue proceeds (including pre-IPO round funds) for establishing a 1.2 GW solar PV TopCon cell manufacturing facility in Pandhurana, Madhya Pradesh through Kartik Solarworld. The remainder amount will be used for general corporate purposes, while the offer-for-sale funds will go to the selling shareholder.
The company that seeks valuation of Rs 3,042 crore competes with listed peers like Sterling & Wilson Renewable Energy, KPI Green Energy, Waaree Renewable Technologies, and Oriana Power.
Should you apply?
"The IPO is priced at a premium to traditional EPC peers, but the shift toward O&M and higher-margin services provides a case for sustained re-rating. Near-term listing gains look likely given sectoral momentum and grey-market signals. Over the long term, the investment case will rest on Solarworld’s ability to consistently deliver 18–20% returns on equity, scale its O&M book, and maintain capital discipline in a highly competitive solar contracting market," said Harshal Dasani, Business Head at INVAsset PMS.
Anand Rathi advised investors to subscribe to the issue for the long term. "The company operates within a highly competitive and fragmented market landscape. The growth of the solar sector in India is predominantly driven by strong government support, evidenced by an aggressive and sustained tendering approach therefore company would capitalize profitability in long run," it said.
Solarworld Energy Solutions Anchor Book:
A day before the IPO opened for public bidding, the solar energy solutions provider said that it has raised Rs 220.5 crore from 14 anchor investors on September 22. VQ Fastercap Fund was the largest anchor investor, acquiring 12.79 lakh shares for Rs 44.89 crore, while Pinebridge Global Funds, Singularity AMC, and Motilal Oswal AMC each bought 7.09 lakh shares for Rs 24.89 crore.
Citigroup Global, BNP Paribas, Varanium Dynamic Trust, Nuvama Private Investment Trust, Cognizant Capital, LC Pharos, India Max Investment Fund, Capri Global, Golden Equity Fund, and Astrone Capital were other buyers in the anchor book.
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