Waaree Energies (Waaree) made a vitality-packed itemizing this present day with the shares making a extra-than-first rate debut at ₹2,550, a 69.7 per cent top class over its IPO scenario impress of ₹1,503. Whereas it has given up a couple of of the positive aspects in further trading, at the time of publishing this article it changed into trading at ₹2,375 which soundless represents a solid 58 per cent amplify over the IPO impress.
The count on for the scenario changed into solid, with the provide getting subscribed around 76 times. The applications acquired against it were around 97.3 lakh in amount – the ideal-ever amount of applications acquired against a public scenario in India.
bl.portfolio in the IPO diagnosis on Waaree published on October 22, 2024 had suggested long-term traders with a high likelihood dawdle for food to subscribe to the scenario. The recommendation changed into on the abet of the firm being a number one player in the commerce, and its grunt prospects as soon as new capacities come on stream.
Now publish the bumper itemizing, it is key time to analyse whether the percentages soundless favour the fortunate traders who acquired an portion, and to take into memoir if new traders may also soundless enter this stock at this juncture.
At the most contemporary impress, the stock is trading at a PE of 51 times its trailing 12-month earnings and 42.5 times its annualised FY25 earnings. This when when put next to the IPO valuation of 32.thrice (TTM PE) and 27 times (FY25 PE annualised), is a piquant creep-up.
How the dangers and rewards stack up
The valuations enjoy jumped up around 60 per cent. Recently listed Premier Energies, a linked listed stare, is right now trading at a TTM PE of around 109 times (IPO valuation changed into at around 51 times). Nonetheless, stacking up the valuations of each and each corporations against one but every other, to term most up-to-date valuations of Waaree as low-worth in total is reasonably misleading. Yes, its low-worth on a relative foundation. But on an absolute valuation foundation, it appears to be like to enjoy extra than adequately factored the long term grunt prospects.
Additionally, whereas Premier Energies is in the center of a ramp-up of new manufacturing lines, Waaree Energies, at this level, appears to be like to be near the tip-end of the utilization curve with its new manufacturing lines, as witnessed from its tepid Y-o-Y income grunt of 2.4 per cent in Q1FY25.
Currently the largest solar PV module producer in India and largest solar PV module exporter to USA from India, Waaree Energies has the largest solar PV module manufacturing capacity in India as on date and is bigger than the following three competitors in line, by installed capacity. Waaree witnessed solid grunt between FY22-24 with income CAGR at 99 per cent. Extra grunt will apply handiest after new capacity comes online.
Within the following three years, the firm proposes to be backward built-in into solar cells, wafers and ingots, and ahead built-in into vitality production and green hydrogen.
With a slew of capex planned which may take the solar module/ cells/ wafers and ingots capacity as much as twenty.9 GW/ 11.4 GW/ 6 GW, by the end of FY27, the firm is positioned to connect a solid footing. The solar module capacity will amplify by 75 per cent over most up-to-date ranges as soon as this capex idea is carried out.
Nonetheless, at a PE of 51 times, for what is a cyclical commerce with dependency on government incentives to steal profitability, the likelihood-reward is not favourable now.
Hence, traders who bought portion may also take into memoir booking earnings and locking in on the positive aspects.