Waaree Energies, a prominent player in India’s renewable energy space, recently made waves with its initial public offering (IPO), capturing investor attention with a robust listing premium. However, following the debut, the stock saw a sharp 10% dip due to profit booking. This blog explores the details behind this high-profile listing, examines key figures, and delves into expert insights on whether to buy, hold, or sell Waaree Energies shares.
Waaree Energies IPO Overview
Waaree Energies, a leading solar photovoltaic (PV) module manufacturer, raised approximately ₹4,321 crore through its IPO. The IPO received an overwhelming response, garnering ₹2.41 lakh crore in total bids and marking a subscription rate of 76 times. This high demand underscored the strong interest from both institutional and retail investors, especially in a time when renewable energy is a hot sector.
- IPO Issue Price: ₹1,503
- Total Raised: ₹4,321 crore
- Total Bids: ₹2.41 lakh crore
- Subscription Rate: 76 times
Strong listing day premium – How much was it?
The Waaree Energies share debuted at ₹2,550 on the Bombay Stock Exchange (BSE), reflecting a substantial 69.7% premium over its issue price of ₹1,503. On the National Stock Exchange (NSE), the stock opened at ₹2,500. This impressive start set a positive tone, especially given that the grey market premium (GMP) had previously indicated high demand. However, the excitement was short-lived as the stock soon faced a decline.
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| Listing Exchange | Opening Price | Premium Over Issue Price |
| BSE | ₹2,550 | 69.70% |
| NSE | ₹2,500 | 66.30% |
The sudden drop – Why did shares fall by 10%?
Despite the promising start, Waaree Energies shares dropped nearly 10% shortly after listing, falling to ₹2,294.5 on the BSE. Profit booking was a primary factor behind this dip, as early investors chose to cash in on their initial gains. This pattern is common in high-profile IPOs, where initial enthusiasm leads to price spikes that eventually normalize once profit booking kicks in.
Experts suggest that while the drop might be concerning to new investors, it is a reflection of market dynamics rather than a sign of trouble for Waaree Energies’ long-term potential. The company, with a solid growth track in solar PV manufacturing, is expected to benefit from the global shift towards renewable energy sources.
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Should you buy, hold, or sell Waaree Energies shares?
The choice between holding and booking profits depends on your investment horizon and risk tolerance. Here’s a breakdown of what experts advise:
| Strategy | Expert Recommendation |
| Hold for Long Term | Investors who believe in the growth potential of renewable energy might consider holding, especially as Waaree’s expansion plans include a 3GW facility in the US. |
| Book Partial Profit | Short-term investors may benefit from booking partial profits to capitalize on the initial listing premium. |
| Sell and Reinvest | If you’re looking to invest in undervalued sectors, cashing out Waaree’s gains and reinvesting could be an option. |
Key factors supporting long-term investment in Waaree Energies
- Solar PV Market Leadership: Waaree Energies is one of India’s largest solar PV module manufacturers, with a current capacity of 12 GW, positioning it well in a growing market.
- Expansion Plans: The company is setting up a 3 GW facility in the United States, indicating its focus on global market expansion and tapping into the US demand for solar energy.
- Strategic Backward Integration: Waaree’s low debt and backward integration strategy help reduce production costs, enhancing profitability over the long term.
- Rising Institutional Interest: With high subscription rates in the IPO, Waaree’s shares attracted substantial institutional interest, indicating strong market confidence in its future.
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The Solar Energy sector – Why it’s worth watching
Investing in solar energy companies like Waaree Energies aligns with the global movement towards sustainability and renewable energy. As countries aim to reduce carbon emissions, companies in the solar industry benefit from favorable policies, government incentives, and growing adoption.
In India, where renewable energy has government backing, Waaree’s leading position in solar PV manufacturing gives it an edge in a sector that’s expected to see sustained growth.
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Final Thoughts – Is Waaree Energies a Good Buy?
For investors with a long-term perspective, Waaree Energies could represent a solid opportunity. The renewable energy sector’s growth potential and the company’s strong market position may offer considerable returns over time. However, for short-term investors, the post-listing dip might serve as a cue to lock in initial gains.
Whether you’re considering a buy, hold, or sell approach, make sure your decision aligns with your investment goals. Renewable energy stocks can be volatile, but Waaree’s fundamentals suggest that it could weather these fluctuations and emerge as a significant player in the market.
