The Waaree Energies IPO is seeing brisk interest amongst investors ahead of its listing on October 28. Not only has the issue been subscribed 79.44 times, the GMP has risen to a whopping 100% plus. The question therefore is what’s that x-factor that’s keeping investor interest intact in this counter?
Siddhartha Khemka, Senior. Group VP – Head of Research (Retail) at Motilal Oswal Financial Services points out that Valuations is a key deciding factor. “Good business with good valuation is what attracts investors and this is what has happened in the case of Waaree. Additionally, given Waaree Energies’ business model, there is a scarcity premium too as there aren’t many companies offering the solar panels that Waaree supplies. Renewable energy space is attracting investor interest and whatever handful of companies are there in this space have showcased good order book position coupled with comfortable valuation,” he added.
Here is a quick look at the key aspects of the Waaree Energies IPO. The 4 positive elements and the 4 concern areas
Also ReadWaaree Energies IPO 2024 Live: Waaree Energies IPO Allotment today; Check GMP, listing date, IPO subscription status and other details
Waaree Energies IPO: What’s Hot?
1. Growing interest in renewable energy: With climate change concerns increasing, renewable energy, as a sector, is gaining traction. Increasingly we see Governments globally veering towards the green options. Consumers too are becoming more environmentally conscious and looking at ways to cut down their carbon footprint.According to ICRA study, renewable energy sources, including biomass, waste to power and waste to energy, have a combined installed capacity of 150.27 GW as of July 2024. The installed renewable energy capacity is expected to increase to about 170 GW by March 2025 and India ranks 4th globally in wind and solar power capacity.
2. Relatively niche play with limited competition: The renewable sector in India is growing by leaps and bounds but there are still relatively less players in the sector. According to IBEF, The renewable energy sector has seen investments worth over Rs 5.2 lakh crore ($70 billion) since 2014. As of now the total number of companies engaged in renewable energy business is a mere 4500 compared to over 1,20,000 globally, highlighting the ample room for growth.
3. Government support in form of PLI: The Government has been pushing forth a series of incentives and schemes to support development of infrastructure and ecosystem for renewable power.
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