Saatvik Green IPO review

•    The company is one of the leading module manufacturers and a fastest growing company in India.
•    It reaped the benefits of China+1 regime and anti-dumping duty on Chinese modules by GoI. It enjoys most preferred partner for solar EPC projects.
•    The company posted spectacular performance with surge in its top and bottom lines for the reported periods.
•    Based on its recent financial data, the issue appears fully priced.
•    Investors can park funds for the medium to long term rewards.

ABOUT COMPANY:
Saatvik Green Energy Ltd. (SGEL) is among the leading module manufacturers in India in terms of operational solar photovoltaic (“PV”) module manufacturing capacity, with an operational capacity of about 3.80 gigawatt (“GW”) modules as of March 31, 2025. (Source: CRISIL Report) It is one of the fastest growing module manufacturing companies in India and have established itself as a key player in India’s solar energy market. (Source: CRISIL Report) Since inception, the company has supplied more than 2.50 GW high-efficiency solar PV modules domestically and internationally.

SGEL is recognized as one of the few companies with capabilities in module manufacturing as well as engineering, procurement and construction (“EPC”) and operations and maintenance (“O&M”) services. (Source: CRISIL Report) It offers EPC services in India and had an installed EPC base of 69.12 MW as of March 31, 2025. The company also provides O&M services to customers primarily in relation to the EPC projects undertaken by it. The company offers a comprehensive portfolio of solar module products that are currently manufactured using technologies that help reduce energy loss and enhance overall efficiency (Source: CRISIL Report). 

Its solar energy products include: (i) monocrystalline passive emitter and rear cell (“Mono PERC”) modules; and (ii) N-TopCon solar modules, both types are offered in mono-facial and bifacial options, suitable for various applications, including residential, commercial and utility scale solar projects. It manufactures products through the use of M10 technology for Mono PERC modules and M10, G12, M10R and G12R technologies for N-TopCon modules.

It has supplied solar modules for various solar installation projects, including floating solar PV modules. Some of its key projects over the last few years include the 61.42 MW floating solar power project at Ramagundam, Telangana in Fiscal 2023, which was one of India’s largest floating solar power plants (Source: CRISIL Report), and the supply of 72.15 MW of solar modules for the Raghanseda Solar Park in Banaskantha district, Gujarat in Fiscal 2023. Its turnkey EPC services comprise end-to-end engineering, procurement and construction services for prominent solar projects. In EPC vertical, the company provides comprehensive solar solutions, managing projects from concept through to execution. Its offerings under this vertical include ground-mounted solar installations and rooftop solar installations. SGEL’s services encompass design and engineering, utilizing tools such as hydraulic powering 940-220 and M12 hydraulic tool meishan as well as procurement, construction and commissioning. It adheres to quality assurance processes and maintain an extensive network of suppliers to support supply chain for all necessary solar components. SGEL’s commitment to effective project management guarantees quality outcomes and reliable performance. 

As part of its EPC portfolio, the company commissioned a 12 MW installation for Jindal Steel and Power Limited under its EPC wing in Fiscal 2024, which was recognized as one of the largest single rooftop solar projects (Source: CRISIL Report). It has also commissioned a 16 MW ground mounted installation for Dalmia Bharat Green Vision Limited in Sattur, Tamil Nadu, India in Fiscal 2024, as well as an 8.08 MW ground mounted installation for Dalmia Cement (Bharat) Limited in Belgaum, Karnataka, India in Fiscal 2024. In Fiscal 2025, it was awarded an EPC project for the design, construction, commissioning and maintenance of a 5 MW ground mounted solar PV plant in Rajpura, Punjab for Nabha Power Limited, as well as a 11 MW solar power project in Lamlehri Upperli, Himachal Pradesh and a 12 MW solar power project in Gondpur Bulla, Himachal Pradesh for Himachal Pradesh Power Company Limited. In addition, it has also been awarded a battery energy storage system (“BESS”) installation project of 30 MW for Bihar State Power Generation Company Limited; as well as a project for the design, engineering, construction, commissioning and O&M of a 40 MW ground-mounted solar power plant in Yavatmal, Maharashtra by Lifelong Renewables Private Limited.

The company commenced manufacturing operations in 2016 and have over the years expanded its annual installed capacity, from 125 MW as of March 31, 2017 to about 3.80 GW as of June 30, 2025. Its revenue from operations has grown from Rs. 608.59 cr. in Fiscal 2023 to Rs. 2158.39 cr. in Fiscal 2025 at a CAGR of 88.32%. Its EBITDA in Fiscal 2023 was Rs. 23.87 cr. that has grown to Rs. 353.93 cr. in Fiscal 2025 at a CAGR of 285.10%. SGEL is one of the largest module manufacturers in North India, which is a lucrative market having high solar incidence areas and proximity to states such as Rajasthan and Madhya Pradesh. (Source: CRISIL Report)

The company currently operates three module manufacturing facilities in Ambala, Haryana (together, the “Ambala Facilities”) spread across a total land area of 724,225 square feet, which together form one of the largest single location module manufacturing facilities in India. (Source: CRISIL Report) Its Ambala Facilities are equipped with fully automated machinery that ensures precision, quality, and efficiency in every stage of the production process. In Fiscal 2025, it recorded a high-capacity utilization of 83.70%. It is in the process of adding a capacity of 1.00 GW in one of its module manufacturing facilities in Ambala, which is expected to be operational in the second quarter of Fiscal 2026, thereby increasing its installed capacity at Ambala Facilities to a cumulative 4.80 GW.

It employs multiple sales and revenue channels to drive business growth and establish its prominence in the solar industry. SGEL’s approach is focused on catering to different market segments, from individual consumers to large-scale industrial and utility clients. As of June 30, 2025, it had 618 employees on its payroll, and 2302 contract workers in various departments.

ISSUE DETAILS/CAPITAL HISTORY:
The company is coming out with its maiden book building route secondary IPO of equity shares issue of 19354838 equity shares worth Rs. 900.00 cr. (at the upper cap). The company has announced a price band of Rs. 442 – Rs. 465 per equity shares of Rs. 2 each. The issue comprises of fresh equity issue worth Rs. 700 cr. (approx. 15053763 shares at the upper cap), and an Offer for Sale (OFS) worth Rs. 200 cr. (approx. 4301075 shares at the upper cap). The issue opens for subscription on September 19, 2025, and will close on September 23, 2025. The minimum application to be made is for 32 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on BSE and NSE. The issue constitutes 15.23% of the post-IPO paid-up equity capital. From the net proceedings of the fresh equity issue, the company will utilize Rs. 10.82 cr. for repayment/pre-payment of certain borrowings, Rs.166.44 cr. for investment in wholly owned subsidiary Saatvik Solar Ind. Pvt. Ltd., for repayment of certain borrowings, Rs. 477.23 cr. for investment in wholly owned subsidiary Saatvik Solar Ind. Pvt. Ltd., for setting up of a 4GW solar PV module manufacturing facility, and the rest for general corporate purposes.

The company has reserved equity shares worth Rs.2 cr. for its eligible employees, and offering them a discount of Rs. 44 per share. From the rest, it has allocated not more than 50% for QIBs, not less than 15% for HNIs, and not more than 35% for Retail investors.

The joint Book Running Lead Managers (BRLMs) to this issue are DAM Capital Advisors Ltd., Ambit Pvt. Ltd., and Motilal Oswal Investment Advisors Ltd., while KFin Technologies Ltd., is the registrar to the issue. Motilal Oswal Financial Services Ltd., Sharekhan Ltd., and Ambit Capital Pvt. Ltd. are the syndicate members.

Having issued entire initial equity shares at par, the company issued bonus shares in the ratio of 5 for 1 in October 2024. The average cost of acquisition of shares by the promoters/selling stakeholders is Rs. NIL, Rs. 0.26, Rs. 0.27, and Rs. 0.29 per share. 

Post-IPO, its current paid-up equity capital of Rs. 22.41 cr. will stand enhanced to Rs. 25.42 cr. Based on the upper cap of the IPO price band, the company is looking for a market cap of Rs. 5910.19 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has (on a consolidated basis) posted a total income/net profit, of Rs. 617.63 cr. / Rs. 4.75 cr. (FY23), Rs. 1097.18 cr. / Rs. 100.47 cr. (FY24), and Rs. 2192.47 cr. / Rs. 213.93 cr. (FY25). 

According to the management, the growth in its top and bottom lines is the result of anti-dumping duty on Chinese products and China+1 regime, we being the leader in the segment got benefits and they hope to continue growth going forward as renewable energy segment is growing leaps and bound in general and the solar energy in particular.

For the last three fiscals, the company has posted an average EPS of Rs. 12.60 (Basic) and an average RoNW of 63.34%. The issue is priced at a P/BV of 15.43 based on its NAV of Rs. 30.14 as of March 31, 2025, and at a P/BV of 5.70 based on its post-IPO NAV of Rs. 81.64 per share (at the upper cap).

If we attribute FY25 earnings to its post-IPO fully diluted paid-up equity capital, then the asking price is at a P/E of 27.63. Based on FY24 earnings, the P/E stands at 58.86. Thus, the issue appears fully priced. 

The company has shown PAT margins of 0.77% (FY23), 9.16% (FY24), 9.76% (FY25), and RoCE margins of 24.80%, 64.07%, 60.45%, respectively for the referred periods.

DIVIDEND POLICY:
The company has not paid any dividends for the reported periods of the offer document. It has already adopted a dividend policy in October 2024, based on its financial performance and future prospects.

COMPARISON WITH LISTED PEERS:
As per the offer document, the company has shown Waaree Energies, and Premier Energies, as their listed peers. They are trading at a P/E of 46.6 and 46.4 (as of September 17, 2025). However, they are not truly comparable on an apple-to-apple basis.

MERCHANT BANKER’S TRACK RECORD:
The three BRLMs associated with the offer have handled 44 pubic issues in the past three fiscals, out of which 11 issues closed below the offer price on the listing date.