Vikram Solar files draft papers for IPO with a fresh issue of Rs.1,500 crore

Vikram Solar, a prominent player in the solar module manufacturing sector, has filed its draft red herring prospectus (DRHP) with SEBI, aiming to raise up to Rs.1,500 crore through an initial public offering (IPO). This is to include fresh equity shares worth the full amount and an offer for sale (OFS) of approximately 17.45 million shares by its promoter group.

IPO Structure & Fund Utilization

The IPO will feature a face value of Rs.10 per share and will incorporate a fixed quota for eligible employees, offering discounts to those who participate in the employee subscription segment. The offering is structured to allocate 50% of the shares to qualified institutional buyers, 15% to non-institutional bidders, and the remaining 35% to retail investors.

Vikram Solar plans to utilize Rs.793.36 crore of the IPO proceeds for capital expenditure, primarily for setting up a 3,000-MW solar cell and module manufacturing facility through its subsidiary, VSL Green Power Private Limited. An additional Rs.602.95 crore will be allocated to expand the existing solar module manufacturing capacity from 3,000 MW to 6,000 MW, alongside provisions for general corporate purposes.

Background & Growth Plans

What’s cool about Vikram Solar is its impressive history. They’ve been around for a while and have built a solid reputation for delivering high-quality solar solutions. Founded in 2009, Vikram Solar has grown from a modest 12 MW manufacturing capacity to a significant 3.50 GW by the time of its DRHP filing. 

As one of the leading manufacturers on the Ministry of New & Renewable Energy’s approved list, the company aims to further increase its capacity to 10.50 GW by FY26 and 15.50 GW by FY27. This includes plans for a new 3,000 MW solar cell manufacturing facility in Tamil Nadu. With the global push for renewable energy, their timing couldn’t be better. The company already has a strong order book, which is always a good sign for investors looking for stability.

Financials & Market Position

Now, let’s talk numbers. Vikram Solar reported a revenue of Rs.1,350 crore in the last fiscal year, with a net profit of Rs.120 crore.  With plans to ramp up production, they’re eyeing a significant share of the expanding solar market. Plus, the government’s push for green energy policies is definitely in their favor.

Conclusion: In conclusion, the IPO is being managed by several prominent financial institutions, including JM Financial, Nuvama Wealth Management, and UBS Securities, with Link Intime India acting as the registrar. With its established reputation and expansion plans, Vikram Solar’s IPO is expected to attract considerable interest from investors.

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.