ACME Solar IPO Lists at 13.15% Discount Below Issue Price on BSE/NSE

ACME Solar Holdings Limited, established in June 2015 and ranking among India's largest renewable energy producers with 1,320 MW operational capacity, made a disappointing debut on the Indian stock market on Wednesday, 13th November 2024, with its shares listing at a significant discount on both BSE and NSE. The company, which specializes in development and operation of large-scale renewable energy projects, entered the public markets with a substantial contracted project pipeline of 1,650 MW.

Listing Details

• Listing Time & Price: ACME Solar shares were listed at ₹251 per share at 10:00 AM IST on NSE following a special pre-open session, where the equilibrium price was discovered at 09:37:53 AM IST, marking a weak start to its journey as a publicly traded company.
• Comparison to Issue Price: The listing price represents a significant discount to the IPO issue price. ACME Solar had set its IPO price band from ₹275 to ₹289 per share, with the final issue price being fixed at the upper end of ₹289.
• Percentage Change: The listing price of ₹251 translates to a discount of 13.15% over the issue price of ₹289.

Invest in Indian Markets and Unlock Future Potential With 5paisa!

Open Account Now

First-Day Trading Performance

• Opening vs. Latest Price: Following its weak opening, by 10:02:16 AM IST, the stock showed strong recovery and was trading at ₹270.60, up 7.81% from its opening price but still below the issue price.
• Market Capitalisation: As of 10:02:16 AM IST, the company's market capitalisation stood at ₹16,373.68 crore.
• Trading Volume: The traded volume was 34.82 lakh shares with a traded value of ₹91.06 crore in early trading.

Market Sentiment and Analysis

• Market Reaction: After a weak opening, the stock showed significant recovery in early trading.
• Subscription Rate: The IPO was oversubscribed by 2.89 times (as of November 8, 2024, 6:19:09 PM), with QIBs leading at 3.72 times subscription, followed by retail investors at 3.25 times, and NIIs at 1.02 times.
• Trading Range: As of 10:02:16 AM IST, the stock hit a high of ₹274.40 and a low of ₹251 during early trading.

Growth Drivers and Challenges

Expected drivers of future performance:

• Leading position in renewable energy sector
• Integrated project development approach
• Diverse renewable energy portfolio
• Long-term government contracts
• Strong project pipeline

Potential challenges:

• High debt-to-equity ratio of 3.89
• Profit volatility concerns
• Project execution risks
• Regulatory changes
• Interest rate sensitivity

Utilisation of IPO Proceeds

ACME Solar plans to use the funds for:

• Repayment of subsidiary borrowings
• General corporate purposes

Financial Performance

The company has shown mixed results:

• Revenue increased by 7.71% to ₹1,466.27 crore in FY2024 from ₹1,361.37 crore in FY2023
• Profit After Tax rose significantly to ₹697.78 crore in FY2024 from a loss of ₹3.17 crore in FY2023

As ACME Solar begins its journey as a listed entity, market participants will closely monitor its ability to execute its project pipeline and maintain profitability. The weak listing but subsequent recovery suggests mixed market sentiment towards the company's prospects in the renewable energy sector.