IPO Note : Vikram Solar Ltd by Choice Broking Ltd
Salient features of the IPO:
* Vikram Solar Ltd.(VSL) As of March 31, 2025, the company ranks among India’s leading manufacturers of solar photovoltaic (PV) modules based on operational capacity, backed by over 17 years of industry experience. It boasts a substantial installed manufacturing capacity of 4.50 GW for solar PV modules as of the date of its Red Herring Prospectus. Furthermore, as of June 30, 2025, its enlisted capacity under the Ministry of New & Renewable Energy’s Approved List of Models and Manufacturers (ALMM) stands at 2.85 GW.
* The IPO solely comprises of fresh issue (Rs. 1500cr) and OFS (547.7 – 579.4cr). From the fresh issue net proceeds, the company will be utilizing Rs. 769.73cr for Partial funding of capital expenditure through investment in its wholly owned Subsidiary, VSL Green Power Private Limited for the Phase-I Project and Rs.595.21cr for its phase-II project. Residual proceeds will be used for general corporate purposes.
Key competitive strengths:
* largest Indian solar PV module manufacturers
* Strong R&D focus with robust quality control systems
* strong technical proficiency
* Strong presence in domestic and international markets
* strong brand recognition and customer
* Robust financial performance with a strong order book
* experienced management team
Business strategy:
* Maintain domestic market position through strategic expansion of solar PV module manufacturing and backward integration
* Continued focus on developing new and innovative products and services
* Further BESS manufacturing operations
* To become a significant global player in the international solar PV module market
* Diversify supply chain.
* Expand into captive projects and cater to the untapped potential in the C&I renewable energy market
* Further new initiatives for decarbonization.
Risk and concerns:
* General slowdown in the global economic activities
* Revenue concentration on solar photovoltaic modules
* Revenue concentration on TOP 5 customers
* Technological changes, evolving customer requirements and emerging industry trends
* Competition.
Valuation Overview and IPO Rating
At the upper price band, the company commands an EV/Sales multiple of approximately 3.2×—a modest valuation compared to its peers, indicating a relative discount. With an order book of 10.34 GW—more than double its current manufacturing capacity of 4.5 GW—the company enjoys strong long-term visibility. Although it’s current EBITDA and PAT margins trail those of its peers, the company has robust expansion strategies: it plans to scale module production capacity to 20.50 GW by 2027; establish a backward-integrated solar cell manufacturing facility with a 12 GW capacity; and develop a 5 GWh Battery Energy Storage System (BESS) manufacturing unit, all by FY27. Combined with its low debt profile, these strategic initiatives support a long-term positive outlook. Thus, we recommend a ‘Subscribe for the long term’ rating.
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SEBI Registration no.: INZ 000160131
