Inox Green Energy IPO: GMP, subscription status on day 2. Should you apply or skip?

Inox Green Energy Services, a subsidiary of Inox Wind, launched its initial public offering (IPO) on Friday, November 11, 2022 and the three-day long issue will conclude on Tuesday, November 15, 2022. The company has fixed a price band of ₹61 to ₹65 per share for its initial share sale. The company on Thursday said that it collected ₹333 crore from anchor investors ahead of its public issue.

As of 1:30 pm on day 2 of the offer, the issue has been overall subscribed 0.64 times with retail category fully booked 1.97x, NIIs 0.11 and QIBs 0.47, as per the BSE data.

Inox Green Energy IPO comprises a fresh issuance of equity shares worth ₹370 crore and an offer-for-sale (OFS) of equity stocks aggregating to ₹370 crore by promoter Inox Wind. The company plans to use the net proceeds from the fresh issue will be utilised by the company for repaying debts and general corporate purposes.

As per market observers, Inox Green Energy shares are commanding a premium (GMP) of ₹6 in the grey market today. The shares of the company are expected to list on stock exchanges BSE and NSE on Wednesday, November 23, 2022.

Inox green has 7% market share in O&M portfolios and having opportunity in inorganic growth through acquisitions of inactive players. Post IPO, Inox green is expected to clear the debt which will reduce the interest cost substantially and improve bottom levels. We are recommending “Subscribe for Long Term” for this issue," said ArihantCapital.

Inox Green Energy Services is engaged in the business of providing long-term Operation and Maintenance (O&M) services for wind farm projects, specifically for Wind Turbine Generators (WTGs) and common infrastructure facilities on wind farms, which support the evacuation of power from such WTGs.

"The macros of the wind energy segment are improving after the regime change and pandemic led restrictions. With massive capacity addition target over the next five years, target market for the O&M services would expand, thereby benefiting players like IWESL. Thus, we assign a “Subscribe with Caution” rating for the issue," said Choice Broking.