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BACKGROUND

Waaree Energies Ltd. is India's largest solar PV module manufacturer, with an installed capacity of 12 GW as of June 30, 2024. Founded in 2007, the company focuses on sustainable energy solutions and has rapidly expanded its production capacity. Waaree offers a wide range of solar modules, including advanced technologies like TopCon and Mono PERC. Waaree has a strong export presence, with international sales representing 57.64% of revenue in Fiscal 2024. As of June 2024, the company’s order book stands at 16.6 GW, and it plans further expansion with new manufacturing facilities.

Objects and Details of the Issue:

The public issue consists of Offer For Sale aggregating up to Rs 721.44 Cr. And fresh issue up to Rs 3600 Cr. Company proposes to utilize the Net Proceeds towards: - Part finance the cost of establishing the 6 GW of Ingot Wafer, Solar Cell and Solar PV Module manufacturing facility in Odisha, by way of an investment in their wholly owned subsidiary, Sangam Solar One Private Ltd.

Investment Rationale:

* India’s Largest Solar PV Manufacturer Ready for Global Growth

* Expansive Global and Domestic Customer Base with Strong Order Book

* Advanced Global-Accredited Manufacturing Facilities

* Extensive Pan-India Retail Network with Franchise Support

* Strategic Backward Integration to Boost Profitability

* Leadership in Utility and Enterprise Modules Market

* Focus on Technological Upgrades

* Leadership in Rooftop and MSME Solar Solutions

* Expansion through Organic and Inorganic Growth

Valuation and Recommendation:-

Waaree Energies is a leader in the solar PV industry, with a massive 12 GW capacity and revenue of Rs.11,398 crore, far exceeding its peers. Its impressive revenue CAGR of 80% (FY21-24) showcases strong growth potential. With a superior ROCE of 39.9% Waaree appears attractive compared to peers. We believe Waaree is available at a substantial discount to its peers, with EV/EBITDA of 25.4x compared to 87.5x for peers, and a P/E of 34.9x compared to 116.8x for peers. Even on the EV/GW (installed capacity) metric, Waaree Energies appears attractive relative to its peers. Thus we recommend to Subscribe to the issue.

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