India's Avaada Electro Files INR 76 Billion IPO Application

en.Wedoany.com Reported - Avaada Electro Limited has moved a step closer to its stock market debut by filing an updated draft red herring prospectus (UDRHP) with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO) of up to INR 76 billion. The IPO comprises a fresh issue of shares worth up to INR 16 billion and an offer for sale (OFS) of up to INR 60 billion by promoter Avaada Ventures Private Limited, with a face value of INR 5 per share.

Approximately INR 12 billion of the proceeds from the fresh issue will be used to repay or settle borrowings and letter of credit liabilities, with the remainder allocated for general corporate purposes. As Avaada Electro incurred significant capital expenditure while scaling up manufacturing, this IPO focuses heavily on the offer for sale and debt repayment; promoter Avaada Ventures also seeks to monetize its investment through the OFS. The company currently has an operational solar module manufacturing capacity of 8.5 GW and a TOPCon cell capacity of 3 GW. Leveraging its existing cell capacity, Avaada is expected to command a higher valuation than pure-play module businesses, which trade at price-to-earnings multiples of approximately 10 to 12 times, while cell and module manufacturers typically command multiples above 18 times, driven mainly by higher margins from module sales meeting DCR requirements.

Indian solar manufacturing IPOs have largely struggled in recent months. Vikram Solar, the last major manufacturer to go public last year, has seen its share price fall well below the issue price, and the company pins its recovery hopes on commencing cell manufacturing. Although ALCM provisions came into effect from June this year, manufacturers' cell operations are not yet operational, and the relevant provisions have been relaxed until December this year; Gulf tensions, rising oil prices, and the closure of the US market to Indian imports have also exerted pressure on prices. Most manufacturers are simultaneously diversifying into areas such as energy storage, aluminum frames, transformers, inverters, and EPC engineering.

Founded in 2021, Avaada Electro is part of the Avaada Group, chaired by Vineet Mittal. The company sells solar modules under the Enlume and Integlow brands through 14 distribution partners across 13 states. Its plant in Dadri, Uttar Pradesh, has a module capacity of 1.5 GW; its Nagpur facility in Maharashtra houses 7 GW of module capacity and a 6 GW cell manufacturing setup, of which 3 GW of cell capacity is already operational, with the remaining 3 GW expected to commence production in the quarter ending September 2026. The company plans to build a fully integrated manufacturing operation covering ingots, wafers, cells, and modules, targeting a module capacity of 13.6 GW, cell capacity of 12 GW, and ingot and wafer capacity of 3 GW by fiscal 2028, positioning itself among India's leading manufacturers. The company also plans to enter the energy storage market under the Avaada Halo brand and expand third-party EPC and operations and maintenance services.

On the technology front, the company focuses on N-type TOPCon and is among the first manufacturers in India to launch 720 Wp TOPCon modules. Its bifacial glass-glass modules achieve efficiencies of up to 23.61%, and its cell efficiencies, ranging from 24.5% to 26.3%, have been included in the government's ALMM List-II. The company states that its N-type TOPCon modules offer a bifaciality of approximately 80% to 85%, compared with around 70% to 75% for the previous-generation PERC technology. Its module products have been recognized as a "Top Performer" in the Kiwa PVEL 2026 PV Module Reliability Scorecard. Avaada Electro's module production cycle time is approximately 16 seconds, and its capital expenditure per GW is lower than that of several comparable Indian manufacturers.

Financially, the company's operating revenue for fiscal 2026 increased from INR 9,116.2 million in fiscal 2025 to INR 53,035.2 million; EBITDA rose from INR 2,416.8 million to INR 12,588.6 million; and profit after tax increased from INR 1,730 million to INR 8,887.4 million. Avaada Energy, another group company, accounted for 89% of Avaada Electro's fiscal 2026 revenue and is its principal customer. During the reporting period, module installed capacity grew from 1.5 GW to 8.5 GW, production increased from 0.63 GW to 3.77 GW, and the order book expanded from 2,555 MW to 19,106 MW.

Avaada Electro targets rooftop solar, residential installations, and large government-backed projects, aiming to benefit from schemes such as PM-Surya Ghar, PM-KUSUM, and CPSU tenders, particularly projects requiring domestically manufactured solar equipment. The company holds a PLI award for 3 GW of ingot-to-module integrated capacity granted in March 2023, which can yield incentives of up to INR 9,616.2 million upon meeting conditions. Under current policy, from June 1, 2026, projects under the ALMM framework must use solar cells manufactured by producers listed in ALMM List-II; the government is also considering implementing ALMM List-III for domestically produced wafers from 2028. The book-running lead managers for this IPO are ICICI Securities, Axis Capital, BofA Securities India, HSBC Securities and Capital Markets (India), SBI Capital Markets, and IIFL Capital Services.

Separately, it has been disclosed that the Avaada Group has signed a memorandum of understanding with the Haryana Enterprise Promotion Centre to develop a 300-acre green industrial park in Hisar, with an investment of INR 100 billion. The park will provide round-the-clock renewable energy and related infrastructure to industries, and Avaada plans to position it as a zero-CBAM industrial park to help companies meet European Union carbon border adjustment mechanism requirements. The Haryana government intends to support the project through single-window clearances, industrial park status, and customized incentives, and Avaada is seeking to bring in investors and technology partners from countries including Germany, the Netherlands, Japan, and South Korea.