Premier Energies Limited is primarily an integrated solar cell and solar module manufacturer with 29 years of experience in the solar industry. The business operations include:(i) the manufacturing of solar photovoltaic ('PV') cells, in particular bifacial monocrystalline PERC cells using the M10 wafer size in a 182mm x 182mm format which may be assembled into solar modules;(ii) the manufacturing of solar modules using different module technologies such as monocrystalline PERC and TOPCon, cell sizes and quantity, power output ranges and formats such as monofacial and bifacial. They also manufacture custom made modules for specific applications;(iii) the sale of customizable and ad hoc solar-related products depending on customer requirements such as customized bespoke solar tiles;(iv) the execution of EPC projects which include end-to-end solar services for ground-mounted, rooftop, floating, canal bank, canal top and hybrid power generation systems;(v) the provision of O&M services with respect to EPC projects executed by the Company; and(vi) independent power production through the 2 MW solar power plant in Jharkhand, India. As of the date of this RHP, they have five manufacturing facilities, all of which are situated on land that they own, in Hyderabad, Telangana, India. Combined, the manufacturing facilities have an annual installed capacity of 2 GW for solar cells and 4.13 GW for solar modules as of the date of this RHP. Company have taken steps such as ordering the necessary equipment and machines to increase the annual installed capacity for solar cells by commissioning a 1,000 MW TOPCon solar cell line in Unit II. They have procured financing for this additional cell line through IREDA, which has estimated project costs of Rs 6,694 million. The additional cell line to be ready within Fiscal 2025. They intend to utilise a portion of the proceeds from the Fresh Issue to further expand the current manufacturing capacities by commissioning an additional 4 GW TOPCon solar cell line and an additional 4 GW TOPCon solar module line. As of the date of this RHP, company's domestic customers are located and operate in 23 states and union territories in India and for Fiscals 2022, 2023 and 2024 and the three months ended June 30, 2024, the total number of customers from India was 165, 193, 200 and 117, respectively, while the total number of customers from overseas markets was 8, 6, 27 and 3, respectively. The key customers across the business offerings include several IPPs, OEMs and off-grid operators such as NTPC, TATA Power Solar Systems Limited, Panasonic Life Solutions Private Limited, Continuum, Shakti Pumps, First Energy, Bluepine Energies Private Limited, Luminous, Hartek Solar Private Limited, Green Infra Wind Energy Limited (a subsidiary of Sembcorp Green Infra Limited), Madhav Infra Projects Limited, SolarSquare Energy Private Limited and Axitec Energy India Private Limited. As of July 31, 2024, they had an order book of Rs 59,265.65 million of which Rs 16,091.14 million was in relation to non-DCR solar modules, Rs 22,140.60 million was in relation to DCR solar modules, Rs 18,911.18 million was in relation to solar cells and Rs 2,122.72 million was in relation to EPC projects. As per financial performance, Premier Energies Limited has posted total income / net profits of Rs 767.03 Cr / Rs (14.42) Cr (FY22), Rs 1,463.21 Cr / (13.19) Cr (FY23), Rs 3,171.31 Cr / Rs 231.36 Cr (FY24) and Rs 1,668.79 Cr / Rs 196.91 Cr (Q1 FY25). So as per previous financials data, company has shown good growth. Company has an average EPS of Rs 2.54 and average RoNW of 17% for last three fiscals. Issue is priced at a P/BV of 23.24 as per NAV of Rs 19.36/- as on 30.06.24. If we attribute latest earnings of FY23, FY24, TTM and annualised FY25 on fully diluted equity post issue then asking price is at a P/E of around (1521), 87.67, 51.15 and 25.75 respectively. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, three lead managers are associated with this IPO, and have handled around 42 IPOs in last three fiscals. Kotak Mahindra Capital Company Limited: This is 27th IPO from this BRLM in last 3 years. From last 10 IPOs, all opened above issue price or at par on the day of listing. As of now, from last 10 IPOs, all are trading above issue price. (As on 22.08.24) J.P Morgan India Private Limited : This is 10th IPO from this BRLM in last 3 years. From last 9 IPOs, two opened below issue price and remaining opened above issue price or at par on the day of listing. As of now, from last 9 IPOs, one is trading below issue price and remaining are trading above issue price. (As on 22.08.24) ICICI Securities Limited: This is 47th IPO from this BRLM. From last 10 IPOs, all opened above issue price or at par on the day of listing. As of now, from last 10 IPOs, all are trading above issue price. (As on 22.08.24) As per financials, Premier Energies Limited has shown good results, RoNW is 37.46% and P/E is (1521), 87.67, 51.15 and 25.75 respectively as per FY23, FY24, TTM and annualised FY25 earnings. So, issue looks fairly priced. Company is in business of manufacturing of integrated solar cell and solar module, which is a very fragmented and competitive business segment. As GoI is giving push to green energy, so we may see good growth for next couple of year. Performance of BRLM is good. So, we give SUBSCRIBE rating with hold for long term for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.
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