Waaree Energies IPO Fully Subscribed Within Two Hours on Day 1; Retail Portion Sees Strong Demand

Waaree Energies' initial public offering (IPO) kicked off on a strong note, with the issue being fully subscribed within just two hours of its opening on October 21. The Rs 4,321 crore IPO, which is one of the most anticipated in the renewable energy sector, saw bids for 2.12 crore shares against 2.1 crore on offer, indicating strong demand, particularly from retail investors.

As a leader in the solar energy industry, Waaree Energies specializes in PV module manufacturing, with a substantial installed capacity of 12 GW as of June 30, 2023. The company's strategic focus on renewable energy solutions, combined with its expansive production capabilities, has generated considerable interest in the IPO market. The grey market premium (GMP) for Waaree Energies shares had already surged to over 100% ahead of the public offering, which further fueled demand among investors.

Retail investors showed significant enthusiasm, oversubscribing their portion by 117% on Day 1. Non-institutional investors also played a key role, buying twice the portion reserved for them. However, the Qualified Institutional Buyers (QIBs) were slower to respond, with their portion remaining unsubscribed by midday. Meanwhile, the employee portion was subscribed to 53%, showing moderate interest from within the company.

The IPO comprises a fresh issue of equity shares worth Rs 3,600 crore, with an additional offer-for-sale (OFS) of 48 lakh shares, amounting to Rs 721.44 crore at the higher end of the price band. This takes the total issue size to Rs 4,321.44 crore. At the upper price band, Waaree Energies' market valuation is expected to exceed Rs 43,179 crore post-issue.

The funds raised from the fresh issue will be primarily allocated to expanding Waaree's manufacturing capabilities. The company is set to establish a 6 GW facility in Odisha that will focus on the production of ingot wafers, solar cells, and solar PV modules. This expansion aligns with Waaree Energies' mission to enhance its leadership in the solar energy sector. Additionally, a portion of the proceeds will be used for general corporate purposes, which will further strengthen the company's operational flexibility.

Waaree Energies currently operates five manufacturing facilities across India. These include plants in Surat, Tumb, Nandigram, and Chikhli in Gujarat, along with the IndoSolar facility in Noida, Uttar Pradesh. With this extensive network, Waaree is well-positioned to meet the growing demand for solar energy solutions both domestically and internationally.

The IPO's strong debut underscores investor confidence in the company's future prospects. The renewable energy sector, particularly solar energy, has been gaining momentum as governments and businesses around the world increasingly prioritize sustainable energy solutions. Waaree Energies, with its established market presence and ambitious expansion plans, is well-poised to capitalize on this growing trend.

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The final subscription figures for the Waaree Energies IPO will be closely watched by market participants, especially as QIBs are expected to play a more significant role in the days to come. The public offering is scheduled to close in a few days, with a listing likely to follow soon after.

[Disclaimer: This article is for informational purposes only and should not be construed as financial advice. Readers are encouraged to conduct their own research or consult with a financial advisor before making any investment decisions. Past performance does not guarantee future results.]