Premier Energies IPO Set to Bumper Listing :The IPO of Premier Energies, a leading company working in the solar industry, has received a great response from investors. Investors have showered money on this IPO. By 4:30 pm on its third day, this IPO has been subscribed 75 times. This issue of Rs 2830 crore has received bids of Rs 1,48,439.29 crore so far. At the same time, its premium in the gray market remains consistently high. The brokerage believes that the company is in a better position to take advantage of the growing solar energy market. The listing of this stock is to be done on 3 September 2024.
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Premier Energies: Subscribed 74.79 times so far
The IPO of Premier Energies has been subscribed 74.79 times till 4:30 pm on its third day. 35 percent share has been reserved for retail investors in the IPO and this share has been filled 7.14 times so far. At the same time, 50 percent share is reserved for qualified institutional buyers and it has been filled 212.42 times. While 15 percent share is reserved for non-institutional investors and it has been filled 50.71 times so far. The portion reserved for employees in the IPO has been filled 10.82 times. They have got a discount of Rs 22 per share.
GMP increased to 87%
The unlisted stock of Premier Energies is seen at a premium of Rs 390 in the grey market, which is 87 per cent in terms of the upper price band of Rs 450. The price band for the IPO was fixed at Rs 427-450 per share. The size of the IPO of solar cell and module manufacturer company Premier Energies Limited was Rs 2830 crore.
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What is the company’s outlook?
Brokerage house Choice Broking says that with proactive regulations, policy support and commitment by the government towards renewable energy, the domestic solar manufacturing market is likely to see strong growth in the mid-term. Manufacturers like PEL are well placed to benefit from the expanding market with their dominant market position. Continued restrictions on trade with China by developed economies like the USA and Europe will continue to provide export opportunities for the company in the mid-term.
The brokerage says that international solar wafer and cell prices have been on a declining trend since mid-2022 and current prices may be lower than FY21 levels. The decline in raw material prices has positively impacted the company’s financial performance during FY24 and Q1 FY25. Thus, any volatility in raw material prices will be negative for the company.
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What are the strengths of the company
• An integrated solar cell and solar module manufacturer
• A long track record in the solar module manufacturing market
• Experienced in solar cell-line production
• A diversified customer base with client relationships within India and a strong order-book overseas
• Senior Management Team led by an experienced promoter
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Key risks and concerns
• A general slowdown in global economic activity
• Unfavorable government policies and regulations
• Disruption in global supply chains mainly due to geo-political tensions
• Difficulty expanding into foreign and US markets
• Delay in commissioning of expansion projects
• Unfavorable foreign currency exchange rates
• Volatility in prices of key raw materials
• Competition from Chinese imports
(Disclaimer: The views or advice on the stock are given by experts and brokerage houses. These are not the personal views of Financial Express. There are risks in the market, so take expert advice before investing.)
