Premier Energies IPO: The good and the bad

Published: 26th Aug 2024

By: Value Research

About Premier Energies

The company manufactures solar cells and modules, which are key components used in making solar panels. Some of the company’s key clients include large players like NTPC and Tata Power. 

Total IPO size (Rs cr) 2830 Offer for sale (Rs cr) 1539 Fresh issue (Rs cr) 1291 Price band (Rs) 427 - 450 Subscription dates August 27 to August 29, 2024 Purpose of issue To fund capex and general corporate expenditure

IPO details

M-cap (Rs cr) 20284 Net worth (Rs cr) 1909 Promoter holding (%) 66 Price/earnings ratio (P/E) 50.9 Price/book ratio (P/B) 10.6

Post-IPO

Key financials 2Y growth (% pa) 12-months ending June 2024 FY24 FY23 FY22 Revenue (Rs cr) 105.7 4190 3144 1429 743 EBIT (Rs cr) 994.2 606 383 26 3 PAT (Rs cr) 443.6 398 231 -13 -14 Net worth (Rs cr) 817 618 382 393 Total debt 1210 1401 764 454

Financial history

EBIT is earnings before interest and taxes PAT is profit after tax

Ratios 3Y average (%) 12-months ending June 2024 FY24 FY23 FY22 ROE (%) 11.9 26.5 43.7 -3.2 -4.7 ROCE (%) 11.7 14.3 25.7 5.9 3.6 EBIT margin (%) 4.8 14.5 12.2 1.8 0.4 Debt-to-equity 1.5 2.3 2 1.2

Key ratios

ROE is return on equity ROCE is return on capital employed

The Good

Its large scale gives it an edge. The company is India’s second-largest manufacturer of solar cells and modules with a total installed capacity of 4.14 GW. Further capacity expansion is in the works. 

The Good

The company’s business is backed by strong sectoral tailwinds as demand for renewable energy sources is only expected to increase with the rising energy needs of the Indian economy.

The bad

Its customer base and overseas dependence for raw material remain key risks. Our story has a detailed analysis of how these risks may play out. Read it from the link below.

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