Motilal Oswal has come out with its report on Sterling and Wilson Solar. The research firm has recommended to "Subscribe'' the IPO in its research report as on August 05, 2019
The issue is entirely an offer-for-sale (OFS) by the promoters of the company (40 mn shares), implying an issue size of INR31 bn and a postissue market capitalization of INR 125 bn (at the higher price band).
Valuation and Outlook
Based on FY19 consolidated numbers, the issue is priced at a P/E of 19.6x. The company is likely to benefit from i) being the largest global EPC contractor in an industry that is seeing a massive thrust towards renewable energy ii) an asset-light business model, and iii) strong parentage. However, considering the current market environment and absence of past comparable financials, investors can Subscribe only from a Long Term perspective
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