Premier Energies, a prominent solar panel manufacturer, made an impressive entrance on the stock market with its initial public offering (IPO), achieving a remarkable 120% gain upon listing. On its debut day, the stock was listed at ₹991 per share on the bombay Stock Exchange (BSE), compared to the issue price of ₹450 per share. On the National Stock Exchange (NSE), it listed at ₹990 per share, reflecting the same 120% gain.
Despite this strong start, the stock experienced some profit-taking shortly after, falling by ₹120 to ₹870.75 per share on the BSE.
Shivani Nyati, Head of Wealth at Swastika Investmart Ltd, attributed the stock’s strong debut to Premier Energies’ solid fundamentals, enthusiastic investor response, and favorable market conditions. She highlighted the company’s diverse customer base, strong order book, and recent profitability surge as key factors behind the positive market sentiment. Nyati emphadata-sized that while Premier Energies stands out in the competitive solar manufacturing industry due to its strategic positioning and innovation, the current high valuation may lead to profit-taking. She recommended that investors who are still holding the stock consider setting a stop-loss at ₹890.
Prashanth Tapse, Senior VP of Research at Mehta Equities Ltd, echoed the sentiment that the listing performance data-aligned with expectations due to strong subscription rates. He noted that the IPO’s success, driven by reasonable pre-listing valuations and the company’s position as India’s second-largest integrated solar cell and module manufacturer, reflected the sector’s growing demand. However, Tapse also pointed out that the post-listing valuation might now be stretched, which could lead to profit-taking. He advised conservative investors to consider booking profits while risk-takers might hold on for the long term, given the sector’s optimistic outlook and the company’s data-alignment with government initiatives promoting domestic solar production.
The Premier Energies IPO, which ran from august 27 to august 29, 2024, was priced between ₹427 and ₹450 per share. The IPO, valued at ₹2,830.4 crore, was heavily oversubscribed, with bids totaling over ₹33,05,16,983 shares compared to the 4,41,06,533 shares on offer. The retail portion was subscribed 7.35 times, non-institutional investors' category 50.90 times, and the Qualified Institutional Buyers (QIB) segment saw a staggering 212.42 times subscription.
The IPO included a fresh issue of up to ₹1,291.4 crore and an offer-for-sale of up to 3,42,00,000 equity shares. The proceeds from the fresh issue, amounting to ₹968.6 crore, are earmarked for investments in Premier Energies Global Environment Pvt Ltd to partially fund the construction of a 4 GW Solar PV TOPCon Cell and 4 GW Solar PV TOPCon Module manufacturing facility in Hyderabad, Telangana, with the remaining funds allocated for general corporate purposes.
With 29 years of experience, Premier Energies operates as an integrated manufacturer of solar cells and modules, boasting an annual installed capacity of 2 GW for solar cells and 4.13 GW for solar modules across its five manufacturing facilities.