Exclusive: Waaree Group aims to raise Rs 2,000 crore through IPO: CMD Hitesh Doshi

The Chinese have reduced solar module prices from 26 cents to 14 cents — this is the lowest ever so far, said Doshi.

Waaree Energies Limited, a solar manufacturing company in India, is aiming to raise Rs 2,000 crore through an initial public offering (IPO), which it plans to close within this financial year, the company’s Chairman and Managing Director (CMD) Hitesh Chimanlal Doshi told Moneycontrol in an interview.

He also said the company will commission its electrolyser manufacturing capacity in FY25 and start its own cell manufacturing unit for EV batteries. Besides, the company will be opening the group’s first solar module manufacturing plant outside India, in Texas, United States.

Doshi emphasised that Indian solar panel manufacturers are currently forced to export most of their production due to low demand for indigenous products since China recently slashed the prices of its solar modules from about 26 cents to 14 cents. Edited excerpts:

Give us an overview of Waaree Group’s expansion plans in the solar manufacturing segment, along with the investments planned for the same.

In solar manufacturing, our expansion will be in two phases. In the first phase, we have achieved our target of having a solar module manufacturing capacity of 12 gigawatts (GW). Now, in the same plant in Chikhli, Gujarat, we are setting up a 5.4 GW solar cell manufacturing capacity, which will be ready by March next year (2024). This first phase cost us Rs 2,800 crore.

In the second phase, we are planning to set up a 6 GW ingot-to-wafer-to-module manufacturing unit, which will cost us approximately Rs 8,000 crore. We have qualified for the production-linked incentive (PLI) scheme of the Ministry of New and Renewable Energy (MNRE) and recently raised Rs 1,000 crore in equity funding for the same. This 6 GW facility will be ready sometime in March 2025.

But the fund requirement is about Rs 8,000 crore. How do you plan to fund the remaining costs?

We will go for an IPO. Currently, we are working on our draft red herring prospectus (DRHP).

How much do you expect to raise through the IPO, and when will it be launched?

We are aiming to raise about Rs 2,000 crore through the IPO. We expect to launch the IPO within this financial year. However, it all depends on how fast our documentation is ready.

Also, has the group finalised the locations for the second phase of the 6 GW ingot-to-wafer-to-module manufacturing unit?

We are currently holding discussions with the governments in Gujarat, Rajasthan and Odisha. The plants will come up in at least two of these locations. In all likelihood, the locations will be finalised in the next two or three weeks.

India has started building its own solar manufacturing units, though the country still has a long way to go in terms of meeting the demand. But has the imposition of basic customs duty (BCD) helped the domestic solar module manufacturing market?

India’s solar project installations are very close to the import numbers now. Between April and August, if about 4 GW of solar installations were done, the imports were also nearly the same at around 3.5 GW.

So, despite the 40 percent BCD, the import of solar modules has not reduced in the country. The Chinese have reduced solar module prices from 26 cents to 14 cents — this is the lowest ever so far. They have also started routing all these parts through free trade agreement (FTA) countries such as Vietnam, Thailand, Cambodia and Laos.

As a result, export has become a compulsion today because of low domestic demand.

Give us an update on the Group's plan to expand overseas.

There’s a significant development on that front. We are going to set up a 2 GW solar module manufacturing factory in Texas, US. This will be Waaree Group’s first unit outside India. A detailed project proposal on this will be ready in two weeks.

Besides, Waaree Group also runs India’s largest NABL-accredited solar module testing laboratory.

So, has the government empanelled your lab to start third-party testing

We have the capability of third-party testing since (we have the) accreditation and certification; everything is in place now. But at this moment, we are using it for our own testing only.

What are your plans in the green hydrogen sector?

We have decided that the group will get into the electrolyser manufacturing business in India starting next year. Work for that has started. So, we will not only be offering green hydrogen EPC, or the technology for that, but we will also manufacture electrolysers in India. The capacity has not yet been decided, but whenever MNRE’s incentive scheme for electrolyser manufacturing is out, we will participate in it.

Currently, we have won a very small tender for one MW of green hydrogen production from the Maharashtra government. But, our plans are to go big on electrolyser manufacturing.

Any plans to expand your battery storage business?

Currently, we are making battery packs for over 40,000 vehicles, and over a thousand storage solutions have been supplied by us so far. But now we are tying up with new technologies and planning to go ahead with our own cell manufacturing unit for the batteries.

We have started offering 250-kilowatt hour (kWh) battery packs. In the next three months, we will also start offering megawatt-scale packs in the Indian market.

Waaree is also an independent power producer (IPP). Any expansion plans on that front?

As an IPP, we have about 60 megawatts peak (MWp) either completed or under construction. But looking at the current challenges, we are going a little slow on that front.

What are these challenges?

Grid connectivity is the biggest challenge today in the states. This is apart from the problem of land, which is not a finite resource. The second thing was also about the viability under the prevalent prices, although now, with module prices coming down to an all-time low, the price has suddenly become viable. But we are not aggressively pursuing it.