Premier Energies, one of the largest solar cell and module maker, has set a price band of Rs. 427-450 per share for its initial public offering that is set to open for subscription on August 27.
At the upper price band, the size of the OFS is around Rs. 1,539 crore, while the total issue size pegged at Rs. 2,830 crore. The public offering comprises a fresh issue of Rs. 1,291.40 crore and Offer For Sale of up to 34.2 million shares by existing promoters and shareholders. The expected market capitalisation after listing could be around Rs. 20,530 crore.
The anchor book will open on August 26 and the issue will close on August 29. Finalisation of allotment will be on August 30, refunds will be on August 2 and the stock will list on exchanges on August 3. South Asia Growth Fund I Holdings LLC, South Asia EBT Trust and promoter Chiranjeev Singh Saluja are the sellers in the OFS.
The proceeds from the issue will be used to invest in arm Premier Energies Global Environment Private 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 reported a revenue of Rs. 1657.37 crore in the June quarter, as against Rs. 611 crore a year ago. Net profit for the quarter stood at Rs. 245.73 crore against Rs. 43.53 crore last year. EBITDA margin for the quarter was at 22.16 percent versus 12.44 percent last year.
Premier Energies – Strength and Weakness
| Strength | Weakness |
| Premier Energies Limited is the second-largest manufacturer of solar cells and solar modules in India, and it is also the second-largest maker of integrated solar cells. Premier Energies has shown to be a leader in the solar energy industry, with an annual installed capacity of 2 GW for solar cells and 3.36 GW for solar modules. | A sizable amount of Premier Energies Limited’s revenue is derived from a limited number of clients. The financial viability of the business might be severely impacted by the loss of any important customers or revenue from them. The risk is raised by the potential for customers to switch to rivals or other products, which might lead to lower profits and revenue. |
| Premier Energies has effectively entered the domestic content requirement (DCR) solar module market by utilising its integrated structure and profiting from government programs such as the CPSU scheme and the PM-KUSUM scheme. The company’s intention to use joint ventures and strategic backward integration to increase manufacturing capabilities in the US further illustrates its dedication to international expansion and market penetration. | Premier Energies’ business has a limited variety of products and is heavily dependent on the performance of solar cells and modules. The profitability and future prospects of the firm are significantly at stake due to factors impacting the market for solar technology, including cost-effectiveness, performance, and regulatory rules. Demand fluctuations or developments in alternative energy sources might have a detrimental effect on Premier Energies’ earnings and competitive standing. |
| Through its journey from polycrystalline solar cells to monocrystalline PERC cells and now to TOPCon cell technology, Premier Energies has a strong commitment to technical developments. The company’s technical skills and capacity to keep ahead of market trends are highlighted by its flexibility and innovation commitment, which have established it as a leader in the solar cell manufacturing industry. | Because of its reliance on imported machinery, especially from China, the firm is vulnerable to a number of hazards, such as shifts in governmental regulations, tariffs, and interruptions in logistics. Any moderations in the importing procedure might cause operations to be delayed, which would affect manufacturing plans and general corporate operations. |
The company has five manufacturing facilities in Hyderabad, providing offerings to customers like NTPC, Tata Power, Panasonic Life Solutions, Shakti Pumps, First Energy 6, Bluepine Energies, Luminous Power Technologies, Hartek Solar, and Green Infra Wind Energy.
The order book stands at Rs. 5,926.57 crore as of June 2024, of which Rs. 1,609 crore is from the non-DCR solar modules segment, Rs. 2,214 crore from DCR solar modules, Rs. 1,891 crore in the solar cells division, and Rs. 212 crore in the EPC projects. Kotak Mahindra Capital Company, JP Morgan India, and ICICI Securities are the book-running lead managers to the issue.
