Sun shines on Premier Energies; govt’s renewables push can make it brighter
Premier Energies, a manufacturer of solar cells and modules, aims to raise ₹2,830 crore through an initial public offering (IPO) that is set to open on August 27. Of this, ₹1,291 crore will be generated from a fresh issue of shares, which will be used for capacity expansion. The remaining will come from an offer for sale by the promoter and private equity investors.
After the proposed IPO, the promoter's stake in the Hyderabad-based company will decrease to 66% from 72%. The company's earnings are expected to benefit from the government's push to increase the share of renewable energy in the installed energy capacity, which is projected to reach 500 GW by 2030 from 172 GW now. A significant contribution is anticipated from solar power. India's installed solar capacity has grown nearly fourfold in the last six years and is expected to reach nearly 200 GW by FY28.
Premier Energies generates revenue from both domestic and international markets and is set to expand its capacity for cells and modules over the next two years, potentially increasing its annual revenue to ₹20,000 crore, based on current realisation. Long-term investors who can withstand cyclical downturns may find this IPO attractive.
Business Model: Premier Energies, founded about 29 years ago, is the second-largest solar cell manufacturer and the fourth-largest solar module manufacturer in India. The company has a total installed capacity of 2 GW for solar cells and 4 GW for solar modules. It is undertaking a capacity expansion project that will
