Premier Energies IPO: Key Details and What to Expect

Premier Energies' initial public offering (IPO) is set to open for subscription on Tuesday, August 27, and will close on Thursday, August 29. Share allotment is expected to be finalized on Friday, August 30, with the company's shares likely to be listed on the BSE and NSE on Tuesday, September 3. Investors who do not receive shares will get refunds on Monday, September 2.

IPO Details

The Premier Energies IPO aims to raise Rs.2,830.40 crore. This includes a fresh issue of 2.87 crore shares valued at Rs.1,291.40 crore and an offer for sale of 3.42 crore shares worth Rs.1,539.00 crore.

Registrar and Lead Managers

KFin Technologies will serve as the registrar for the IPO. Kotak Mahindra Capital Company, JP Morgan India Private Limited, and ICICI Securities are the book-running lead managers overseeing the issue.

Price Band and Minimum Investment

The price range for the shares is set between Rs.427 and Rs.450 each, with a face value of Rs.1 per share. The minimum lot size is 33 shares, meaning the smallest investment for retail investors is Rs.14,850.

Objectives of the IPO

The proceeds from the IPO will mainly be used to fund Premier Energies Global Environment Private Limited's new 4 GW Solar PV TOPCon Cell and 4 GW Solar PV TOPCon Module manufacturing plant in Hyderabad. Remaining funds will be directed towards general corporate needs.

Business Overview

Premier Energies produces solar cells and modules. It operates five manufacturing facilities in Hyderabad, with an annual capacity of 2 GW for solar cells and 4.13 GW for solar modules.

Industry Outlook

The renewable energy sector is expected to experience substantial growth. By 2050, nearly 75% of electricity is expected to come from renewable sources, with India aiming for 50% by 2030. The company’s revenue has increased steadily from Rs.7,428.71 million in FY22 to Rs.31,437.93 million in FY24. The company turned a profit of Rs.2,313.60 million in FY24, up from a loss of Rs.143.60 million in FY22.

Key Risks

Premier Energies' revenue relies heavily on a small number of customers and is dependent on the success of its solar products. The company also has significant working capital needs.

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Current GMP

The latest grey market premium (GMP) for Premier Energies' IPO is Rs.336. This suggests an estimated listing price of Rs.786 per share, which represents a 74.67% premium over the top end of the price band.