Fujiyama Energy IPO: The Fujiyama Energy Methods IPO, which closes as we speak, on November 17, has attracted market consideration as the corporate appears to be like to lift Rs 828 crore by way of a mixture of recent concern and offer-for-sale.
As subscription figures proceed to construct, market knowledgeable Anil Singhvi has shared his evaluation of the IPO, highlighting each the strengths and issues traders ought to consider.
Fujiyama Energy Methods IPO Subscription Standing
As of the third day of bidding, the IPO had obtained 42 per cent subscription, with the QIB class at 81 per cent, retail traders at 38 per cent, and non-institutional traders at 16 per cent, within the early market session.
The corporate has already raised Rs 247 crore from anchor traders and Rs 75 crore in a pre-IPO spherical, indicating early institutional curiosity.
Fujiyama Energy Methods IPO: Ought to You Subscribe?
Singhvi notes that one of many largest positives for Fujiyama Energy Methods is its skilled promoter group and robust branding within the photo voltaic trade.
The corporate operates by way of well-recognised manufacturers equivalent to UTL Photo voltaic, which has a legacy of 28 years, and Fujiyama Photo voltaic. This long-standing presence has helped the corporate construct important belief and recall worth within the rising rooftop photo voltaic section.
He additionally highlights the corporate’s asset-light retail distribution mannequin, which has allowed it to scale rapidly with out heavy dependence on authorities tenders.
Round 90 per cent of the corporate’s income comes from sellers and franchise companions, making it a powerful B2C participant.
Fujiyama Energy Methods additionally advantages from a diversified product combine, together with photo voltaic panels, batteries, inverters, and hybrid methods, a bonus in a sector witnessing fast-paced progress.
On the monetary entrance, the corporate has proven a powerful progress trajectory, with revenues rising from Rs 664 crore in FY23 to Rs 1,540 crore in FY25, and revenue rising from Rs 24 crore to Rs 156 crore throughout the identical interval.
Singhvi sees this progress pattern as a key issue supporting the IPO.
Nevertheless, he additionally identifies a number of issues. The corporate’s debt has elevated sharply by 73 per cent, rising from Rs 200 crore to Rs 346 crore, and it could require extra borrowing to help future enlargement.
Valuation is one other space of warning: with a P/E of round 35, the IPO seems costly in comparison with listed friends. Singhvi additionally factors out the volatility in margins, which jumped from 8 per cent to 16 per cent in two years, and says it stays to be seen whether or not such enchancment is sustainable.
Money flows have additionally proven a decline, from Rs 85 crore to Rs 18 crore, an element he urges traders to look at intently. Moreover, the rooftop photo voltaic trade faces intense competitors and is closely depending on authorities subsidies, including one other layer of danger.
In response to Singhvi, whereas the corporate’s strengths make it enticing, low-risk-taking traders could desire to attend for the itemizing and observe preliminary value motion earlier than taking a name.
