IPO Review: Waaree Energies IPO versus Deepak Builders IPO. Which one should you subscribe? | Stock Market News

IPO Review: The fourth week of October is seeing a flurry of initial public offerings, with four mainboard issues hitting the D-Street almost simultaneously, with just a day or two’s difference. Both the Waaree Energies IPO and the Deepak Builders & Engineers India IPO, which are opened between October 21-23, are fully subscribed, thanks to good retail and non-institutional participation. However, market experts are more inclined towards subscribing to the Waaree Energies IPO and are less enthusiastic about the Deepak Builders & Engineers India IPO.

Waaree Energies plans to raise ₹3,600 crore through a fresh issue of equity shares, in addition to an Offer For Sale (OFS) of 48 lakh equity shares valued at ₹721.44 crore at the higher end of the price range. The total size of the offer will be ₹4,321.44 crore, including the OFS by a promoter and existing shareholders. As part of the OFS, shares will be offloaded by promoter Waaree Sustainable Finance Pvt Ltd and shareholder Chandurkar Investments Pvt Ltd. The funds raised from the fresh issue will be utilised to set up a 6 GW Ingot Wafer, Solar Cell, and Solar PV module manufacturing facility in Odisha. Furthermore, a portion of the funds will be allocated for general corporate purposes.

Whereas, Deepak Builders & Engineers India IPO consists of 1.07 crore equity shares valued at ₹217.21 crore through a fresh issue, along with an offer-for-sale of 21.1 lakh shares valued at ₹42.83 crore. The company plans to allocate ₹30 crore from the fresh issue proceeds to repay debt. Additionally, ₹111.96 crore will be allocated to meet working capital requirements, and the remaining IPO funds will be used for general corporate purposes.

Here’s what expert says on Waaree Energies IPO

Arun Kejriwal, the founder of Kejriwal Research and Investment Services

Arun Kejriwal, the founder of Kejriwal Research and Investment Services, said that the company currently has a solar module manufacturing capacity of 13.3 gigawatts, which will be expanded through the establishment of a new plant in Orissa with a capacity of 6 gigawatts, and a 1.6 gigawatt capacity in its US subsidiary.

Additionally, the company plans to backward integrate into solar cell production with a capacity of 5.4 gigawatts, to be operational over the next 6 months, and an additional 6 gigawatts at the Orissa plant. The commercialisation of the Orissa plant is expected to be completed within 36 months. Moreover, the company will also commence the production of ingot wafers with a capacity of 6 gigawatts, estimated to start by fiscal 2027. With a proven track record, the company has established a reasonable size and scale in the business.

The issue price is approximately equal to the price in the grey market. It is sensible to apply for the issue with the aim of gaining from its listing, but deciding whether to hold onto it afterwards is a personal choice, as the valuations will no longer be inexpensive at that time.

Prashanth Tapse, Senior Vice President of Research at Mehta Equities

Prashanth Tapse believes Waaree Energies IPO brings investors an opportunity to invest in the largest manufacturer of solar PV modules in India with, with an impressive installed capacity of 12 GW. Tapse thinks that the company’s rapid capacity growth from 4 GW to 12 GW, bolstered by favourable government policies like the Domestic Content Requirement (DCR) and Performance Linked Incentive (PLI) scheme, positions it well to capitalize on India’s growing renewable energy needs.

“Waaree’s deep market penetration, consistent capacity expansion, backward integration into solar cell manufacturing and leadership in the solar PV module space position it to capture increasing demand both domestically and internationally. Hence, we recommend investors to “SUBSCRIBE” the Waaree Energies IPO for a long term perspective,” said Tapse.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.