Sahaj Solar Ltd. IPO: A Comprehensive Overview
About the Company
Sahaj Solar Ltd. (SSL) is a notable player in the renewable energy sector with nearly a decade of experience. The company operates primarily in three business segments:
- PV Module Manufacturing: SSL’s manufacturing plant in Bavla, Ahmedabad, Gujarat, has a 100 MW capacity. This automated facility produces both mono and polycrystalline PV modules, including high-efficiency Mono PERC modules. The plant uses Crystalline Photovoltaic Technology to manufacture customized size PV modules, marketed under the brand name ‘SAHAJ’.
- Solar Water Pumping Systems: SSL offers solar water pumps, significantly contributing to the Pradhan Mantri Kisan Urja Suraksha evem Utthan Mahabhiyan (PM KUSUM) Scheme. This government initiative aims to install solar pumps and grid-connected renewable power plants to benefit over 20 lakh farmers, enabling multi-season crop production.
- EPC Services: SSL provides comprehensive engineering, procurement, and construction (EPC) services. These include the design, supply, installation, testing, commissioning, and maintenance of solar projects of various scales, from simple domestic installations to large-scale solar power plants.
Financial Performance
SSL has demonstrated substantial growth over recent years, with significant increases in both revenue and profit:
- FY21: Revenue of ₹62.19 crore, Net Profit of ₹0.71 crore
- FY22: Revenue of ₹67.29 crore, Net Profit of ₹1.03 crore
- FY23: Revenue of ₹185.81 crore, Net Profit of ₹6.48 crore
- FY24: Revenue of ₹201.72 crore, Net Profit of ₹13.37 crore
Key financial indicators include an average EPS of ₹11.27 and an average RoNW of 34.61% over the last three years. The company’s PAT margins improved from 0.96% in FY21 to 6.52% in FY24, while RoCE margins increased from 8.62% in FY21 to 26.47% in FY24.
IPO Details
SSL is launching its IPO to raise ₹52.56 crore by issuing 2,920,000 equity shares at a price band of ₹171 to ₹180 per share. The IPO will open on July 11, 2024, and close on July 15, 2024. Post-IPO, the company’s paid-up equity capital will increase from ₹8.07 crore to ₹10.99 crore, targeting a market cap of ₹197.75 crore. The issue constitutes 26.58% of the post-IPO paid-up capital.
IPO Reservation Details:
| Category | Shares Offered |
|---|---|
| QIB | Not more than 50.00% of the Net offer |
| Retail Investors | Not less than 35.00% of the Offer |
| NII (HNI) | Not less than 15.00% of the Offer |
| Market Maker portion | 146,400 shares |
| Employee Reservation | 24,000 shares at a discount of ₹15 per share |
Use of IPO Proceeds
The net proceeds from the IPO will be utilized as follows:
- ₹39.42 crore for working capital requirements
- The remaining amount for general corporate purposes
Investment Strategy and Conclusion
While SSL’s recent financial performance is strong, there are concerns about the sustainability of its growth given the increasing competition in the renewable energy sector. SSL’s debtor days stand at 161, and it holds a contingent liability of ₹15.80 crore for performance guarantees. These factors, along with the crowded market, suggest a cautious approach.
However, given SSL’s robust financials and strategic positioning, investors with surplus funds might consider this IPO for long-term rewards. The issue appears fully priced based on FY24 earnings, with a P/E ratio of 14.79.
Comparison with Peers
SSL’s listed peers include Shakti Pumps, Zodiac Energy, and Solex Energy, which are trading at P/E ratios of 63.8, 103, and 133, respectively. While not directly comparable, SSL’s lower P/E ratio suggests a relatively attractive valuation. For more detailed information, refer to the Sahaj Solar IPO Prospectus.
Key Financial Metrics (as of March 31, 2024)
| Metric | Value |
|---|---|
| ROE | 39.96% |
| ROCE | 26.47% |
| RoNW | 39.96% |
| P/BV | 4.41 |
| PAT Margin | 6.52% |
| Pre-IPO EPS | ₹16.58 |
| Post-IPO EPS | ₹12.17 |
| Market Cap | ₹197.75 crore |
IPO Timeline
| Event | Date |
|---|---|
| IPO Open Date | July 11, 2024 |
| IPO Close Date | July 15, 2024 |
| Basis of Allotment | July 16, 2024 |
| Initiation of Refunds | July 18, 2024 |
| Credit of Shares to Demat | July 18, 2024 |
| Listing Date | July 19, 2024 |
Conclusion
Sahaj Solar Ltd. presents an intriguing investment opportunity within the renewable energy sector. While the company’s growth trajectory and financial health are promising, investors should be cautious of sector saturation and sustainability concerns. For those with a higher risk tolerance and surplus funds, this IPO offers potential long-term rewards. For more IPO details plz visit https://undergroundfinanceinsight.com/
Sahaj Solar Limited Contact Details
Sahaj Solar Limited
Office No. 301, Ashirvad Paras,
Opp. Prahladnagar Garden,
Satellite, Ahmedabad – 380051
Phone: +91-079-68171800
Email: cs@sahajsolar.com
Website: http://www.sahajsolar.com/
FREQUENTLY ASKED QUESTIONS
What is Sahaj Solar IPO Investors Portion?
The investors’ portion for QIB is 50%, NII is 15%, and Retail is 35%.
What is ‘pre-apply’ for Sahaj Solar Limited IPO?
Pre-apply will alow you to apply for the Sahaj Solar Limited IPO 2 days before the subscription period starts.
How to Apply the Sahaj Solar IPO through Paytm Money?
Log in to Paytm Money Application with your credentials. Select the IPO. You will see the IPO Name “Sahaj Solar”. Click on Bid Button. Confirm your application. Now go to your UPI App on Net Banking or BHIM App to Approve the mandate. Open Demat Account with Paytm Money.
How to Apply the Sahaj Solar IPO through Upstox?
Log in to Upstox Application with your credentials. Select the IPO. You will see the IPO Name “Sahaj Solar”. Click on Bid Button. Confirm your application. Now go to your UPI App on Net Banking or BHIM App to Approve the mandate. Open Demat Account with Upstox.
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