The lucky ones who got allotment in the initial public offering (IPO) of Premier Energies are laughing all the way to the bank. The company made an impressive debut on the bourses on Tuesday (September 3), listing at 120% premium to the IPO price.
The stock started trading at ₹990 on the NSE and at ₹991 on the BSE, while its issue price was ₹450. The grey market premium (GMP) of Premier Energies saw a sharp upside after a bumper strong bidding for the issue. Last heard, the company was trading at a premium of ₹487 per share, which suggested a listing pop of around 108% for the investors.
Shivani Nyati of Swastika Investmart said the company’s strong fundamentals and growth prospects underpin this enthusiasm. Premier Energies boasts a diversified customer base, a robust order book, and a recent surge in profitability.
Prashanth Tapse of Mehta Equities expected the IPO to see robust listing gains but recommend allotted investors to choose profit booking on the listing day if its listed in the range of 80-100%.
Mehta believed that the investor demand has come considering reasonable valuations, well-positioned to capitalise the industry demand in renewable energy and an opportunity to invest in India’s second-largest integrated solar cell and module manufacturer.
The robust demand was also seen in the subscription numbers as the issue was booked 74.38 times on the final day of the bidding process. The category for qualified institutional bidders (QIBs) was booked a stellar 216.67 times, while the quota for non-institutional investors saw 50.04 times subscription. The portion reserved for retail investors saw bidding of 7.69 times.
Premier Energies sold its shares in the range of ₹427 to ₹450 apiece for its ₹2,830 crore IPO, which was open for bidding between August 27 and August 29.
The offer comprised a fresh share sale of 2.87 crore shares aggregating to ₹1,291.4 crore and an offer-for-sale (OFS) of up to 3.42 crore equity shares by its promoters and existing shareholders amounting to ₹1,539 crore.
Post the listing, the market capitalisation is expected to be around ₹20,530 crore. The issue proceeds will be used to invest in arm Premier Energies Global Environment Pvt. Ltd. for part-financing a 4 GW Solar PV TOPCon Cell and 4 GW Solar PV TOPCon Module manufacturing facility in Hyderabad. TOPCon stands for Tunnel Oxide Passivated Contact, and it is a new type of solar cell being positioned as the next PV standard.
Premier Energies manufactures integrated solar cell and solar panel. The company’s product portfolio includes Cell, Solar Module, Monofacial modulesBifacial modules, EPC Solutions and O&M Solutions.
The company has five manufacturing units, all of which are situated in Hyderabad, Telangana, India.
Premier Energies recorded a revenue of ₹1,657 crore in the June quarter, compared to ₹611 crore a year ago. The company’s net profit for the quarter stood at ₹198 crore as against ₹31 crore last year. Its EBITDA margin for the quarter stood at 22.16% as against 12.44% last year.
