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Inox Green Energy to list today. Can debut be better than IPO performance?


One of the major wind power operation and maintenance service providers, Inox Green Energy Services will make its market debut on Wednesday. The company’s 740 crore initial public offering (IPO) which ended last week, received full subscriptions driven by retail investors and institutional buyers. Inox Green Energy Services is a subsidiary of the listed firm Inox Wind.

In a notice, BSE said, trading members of the exchange are hereby informed that effective from November 23, 2022, the equity shares of Inox Green Energy Services shall be listed and admitted to dealings on the Exchange in the list of ‘B ‘ Group of Securities.

Also, NSE notified that the equity shares of Inox Green Energy shall be listed and admitted to dealings on the exchange with effect from November 23. Trading shall be in the Normal Market segment – Compulsory Demat (Rolling Settlement) for all investors.

Inox Green Energy launched its IPO on November 11 and ended on November 15. The company’s IPO included a fresh issue of 370 crore and an offer for sale (OFS) of 370 crore. It had fixed a price band of 61 and 65 per equity share.

On the last day of the IPO (November 15), the issue fully subscribed by 1.55 times. The performance was driven by retail individual investors who were the major buyers as the portion reserved for their category oversubscribed by 4.70 times. Also, the portion reserved for qualified institutional buyers (QIBs) subscribed by 1.05 times. But Inox Green Energy IPO witnessed a lacklustre demand from non-institutional investors as this category merely subscribed by 47% against the portion reserved.

Inox Green Energy is engaged in the business of providing long-term O&M services for wind farm projects, specifically the provision of O&M services for wind turbine generators (WTGs) and the common infrastructure facilities on the wind farm which support the evacuation of power from such WTGs.

What to expect from Inox Green Energy’s listing?

As per Avinash Gorakshkar, Head of Research at Profitmart Securities Inox Green Energy shares may have a moderate début as the market mood is slightly under bears grip and weekly expiry is also fast approaching.

Gorakshkar added that “one should book profit with whatever listing premium they get as profit booking is expected to trigger any time after less than expected listing premium in Archean Chemical issue.”

Pravesh Gour, Senior Technical Analyst, Swastika Investmart also expects a muted listing for Inox Green Energy due to the negative P/E, lower-than-expected subscription numbers (1.55), and the nature of the issue being OFS, as well as the lack of activity in the grey market.

Swastika Investmart analyst added, “Inox Green Energy Services is one of the major wind power operation and maintenance service providers in India. It has a robust and diverse existing portfolio, and government initiatives on renewable energies under Atamnirbhar Bharat might have a favourable impact on it in the future. company has plans to grow into a more asset-light business model.”

Further, Gour said, “On the other hand, it has been incurring losses in the last 2 years, so the issue is priced at a negative P/E, and according to the IPO objective, the IPO amount will be used to pay off liabilities. Finally, the performance of its group is also not attractive enough. Thus, we assigned an “avoid” rating to this issue.

Meanwhile, Manoj Kumar Dalmia, Founder, and Director, of Proficient Equities said, “Inox Green Energy is the leading wind power solutions provider in India. Inox manufactures wind turbine generators. Main Objective is to part finance its expansion and up-gradation of existing manufacturing facilities, investment in subsidiaries and raise a general corpus fund. The issue is aggressively priced with an asking PE of 30. Investment with a long-term plan may be considered as the renewable energy sector is set to gain attention going ahead.”

 

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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