INOX Green Energy to list on Wednesday. Grey market premium hints at muted market debut

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Inox Green Energy, whose initial public offer (IPO) was sold from November 11 to November 15, will make its market debut on Wednesday. The listing ceremony for the wind energy operation and maintenance service provider will take place at BSE. If one goes by the suggestion of gray market premium (GMP), then there is every possibility of a muted listing for the stock.

The issue, which was commanding a thin GMP during its IPO bidding process, was last traded at a discount of Rs 1-2 per share, indicating a market debut at an issue price of Rs 65. Had been.

Inox Green Energy Services is engaged in providing long term O&M services for wind farm projects, especially O&M services for Wind Turbine Generator (WTG). The company provides specialized O&M services for all WTGs sold by Inox Wind through the entry of long-term O&M contracts between the WTG purchaser and terms generally ranging between 5 to 20 years.

The IPO was subscribed 1.55 times by the loss-making company, mainly due to bidding by retail (4.7 times) and qualified institutional buyers (1.05 times). The quota reserved for non-institutional investors was under-subscribed by 47 per cent.

Brokerages such as KR Choksi Shares & Securities, Arihant Capital Markets, Hem Securities and Ventura Securities have ‘Subscribe’ rating on the issue.

Analysts said a strong and diversified portfolio, favorable national policy support, visibility to future growth, support from long-term O&M contracts and backing by parent company Inox Wind were major positives for Inox Green, but the IPO The valuation was based on price. Prevailing financial position.

There is no Peers listed for INOX Green Energy. Global players include Siemens Gamesa (EV/EBITDA multiple of 35.2 times) and Vestas Wind (EV/EBITDA of 18.7 times for 2021).

KR Choksi in his report said that he is being cautious about the company’s order book as most of its contracts are with its parent company IWL. But it was optimistic on the company’s prospects, given the company’s consistent track record, strong parentage and government initiatives to push the renewables sector.

It expected that the financial position of the company would improve with the reduction of debt on the books.

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