Waaree Energies GMP suggests robust listing, but long term rewards are equally promising

Even as the share allotment is finalised, the Street is eagerly awaiting the debut of Waaree Energies next week, given the shares are commanding a hefty premium in the grey market.

Waaree Energies shares are trading with a GMP of Rs 1350 in the grey market and considering the upper price band, the stock is expected to list with a premium of 90%.

The GMP came down a bit from over 100% in the previous day, impacted by secondary market sentiments.

Analysts said given the company’s strong fundamentals, leadership in the solar energy sector, and the overwhelming subscription numbers, the expected listing price seems justified. Not just the listing gains, the stock could reward.

“For those who receive an allotment, holding the stock for the long term could be a good strategy, considering Waaree Energies’ growth potential in the renewable energy space. However, investors with a short-term view may consider booking partial profits on listing day, especially if the stock sees a significant surge,” said Shivani Nyati, Head of Wealth, Swastika Investmart.

However, investors should be mindful of market conditions post-listing, which can influence short-term price movements.The Rs 4321 crore IPO received an overwhelming response from investors by receiving bids worth Rs 2.41 lakh crore. The overall subscription stood at 76 times at close, driven by 208 times subscription in institutional category and 62 times subscription in non-institutional investors’ portion.The company proposes to use the funds raised from the IPO for key initiatives, including establishing a 6 gigawatt (GW) manufacturing facility for ingots, wafers, solar cells, and PV modules in Odisha, as well as supporting general corporate purposes.

Waaree Energies is the largest manufacturer of solar PV modules in India with the largest aggregate installed capacity of 12 GW, as of June 2024. For Fiscal 2024, the company had the second best operating income among all the domestic solar PV module manufacturers in India.

It is also expanding its footprint by establishing a 3 GW manufacturing facility in the United States, further diversifying its operational capabilities.

For FY24, the company’s revenue from operations jumped 69% year-on-year to Rs 11,398 crore, while profit after tax more than doubled to Rs 1,274 crore.

Axis Capital, IIFL Securities, Jefferies India, Nomura Financial, SBI Capital, Intensive Fiscal Services and ITI Capital are the book running lead managers to the issue.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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