Inox Green Energy Services IPO set to open on Nov 11; price band at ₹61 to ₹65 a share

• Inox Green Energy Services plans to raise ₹740 crore through a fresh issue of shares worth ₹370 crore and an offer for sale up to ₹370 crore.
• The net proceeds from the fresh issue will be utilised towards repaying debts and general corporate purposes.
• The grey market premium (GMP) for the company’s shares are at ₹6 per share.
• Inox Green Energy registered a net loss of ₹4.9 crore on revenue of ₹172 crore in FY22. A year earlier its net loss was ₹27.7 crore.
• It is currently entirely dependent on its parent Inox Wind for business.

Wind power operation and maintenance service provider Inox Green Energy Services’ ₹740 crore initial public offering (IPO) is set to open on November 11 and close on November 15. The price band for the issue is set at ₹61-65 a share.

The grey market premium (GMP) for the company’s shares are at ₹6 per share. GMP is the premium at which IPO shares are traded in an unofficial market before they are listed on the stock exchanges.

The IPO comprises a fresh issue of shares worth ₹370 crore and an offer for sale of up to ₹370 crore. The net proceeds from the fresh issue will be utilised towards repaying debts and for general corporate purposes.

The company is in the business of providing long-term operation and maintenance (O&M) services for wind farm projects, specifically the provision of O&M services for wind turbine generators (WTGs) and the common infrastructure facilities on the wind farm.

Inox Green Energy Services is a subsidiary of Inox Wind, which is listed on exchanges.

As of June 30, 2022, its O&M services portfolio consisted of an aggregate 2,792 megawatts of wind farm capacity and 1,396 WTGs. The company provides O&M services to all customers who purchase WTGs from its parent company during the relevant warranty period as part of a one-stop shop/turnkey solution.

It is currently entirely dependent on its parent Inox Wind for business.

In its red herring prospectus (RHP) filed with the The Securities and Exchange Board of India (SEBI), Inox Green Energy Services said that if the parent company were to choose another service provider for operation and maintenance services of their wind turbine generators, its business, financial condition and prospects may be adversely affected.

“We also intend to continue looking for opportunities to strategically acquire the O&M portfolios of other wind OEMs, especially smaller-scale wind OEMs or third-party and independent service providers, which we believe are currently unable to compete effectively, to further grow our portfolio base,” the company said.

Besides, there are outstanding legal proceedings involving the company, its subsidiaries, directors, promoter and group companies. “These proceedings are pending at different levels of adjudication before various courts, tribunals and appellate tribunals. Such proceedings could divert management time and attention and consume financial resources in their defence,” said the company in its RHP.

Inox Green Energy Services registered a net loss of ₹4.9 crore on revenue of ₹172 crore in FY22. A year earlier its net loss was ₹27.7 crore.

The company has a presence in Gujarat, Rajasthan, Maharashtra, Madhya Pradesh, Karnataka, Andhra Pradesh, Kerala and Tamil Nadu. Its customers comprise large independent power producers (IPPs), PSUs and retail customers, such as Gujarat Fluorochemicals, Continuum Power Trading (TN), Gujarat Industries Power Company, Torrent Power, Shree Cement and several others.

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