Inox Green Energy Services Limited IPO
Inox Green Energy is one of the major wind power operation and maintenance (“O&M”) service providers within India. The Company is engaged in the business of providing long-term 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 which support the evacuation of power from such WTGs. The company have stable annual income owing to the long-term O&M contracts that we enter into with their customers. Inox Green Energy is a subsidiary of Inox Wind Limited (“IWL”), a company which is listed on the National Stock Exchange of India Limited and BSE Limited, and part of the Inox GFL group of companies (“Inox GFL Group”). The subsidiaries are engaged in the business of power generation through renewable sources of energy with Nani Virani Wind Energy Private Limited being the only subsidiary which has commenced power generation as of the date of this Red Herring Prospectus.
We enjoy synergistic benefits as a subsidiary of IWL, which is principally engaged in the business of manufacturing WTGs and providing turnkey solutions by supplying WTGs and offering a variety of services including wind resource assessment, site acquisition, infrastructure development, EPC of WTGs, and, through the Company, providing long-term O&M services for wind power projects. Pursuant to an exclusivity agreement between IWL and the Company, we provide exclusive O&M services for all WTGs sold by IWL through the entry of long-term O&M contracts between the WTG purchaser and ourselves for terms which typically range between five to 20 years.
Due to this exclusivity agreement, IWL’s order book is an important indicator of future revenue and growth for the Company. As of June 30, 2022, IWL had entered into binding contracts for the supply of 2 MW capacity WTGs with an aggregate capacity of 964 MW. Further, IWL had also received letters of intent, which are non-binding and which therefore may not lead to execution of any form of binding contract, for its new 3.3 MW capacity WTGs with an aggregate capacity of 524.7 MW.
Set out below is a diagram which summarizes the general process from the manufacturing of a WTG by, for example, IWL, to the point where the provision of the O&M services commences.
Objects of the Inox Green Energy Services Limited IPO:
Inox Green Energy Services Limited IPO Details:
|Open Date:||Nov 11 2022|
|Close Date:||Nov 15 2022|
|Face Value:||₹ 10 Per Equity Share|
|Issue Type:||Book Built Issue|
|Issue Size:||740.00 Cr.|
|Lot Size:||230 Shares|
|Issue Price:||₹ 61-65 Per Equity Share|
|Listing Date:||Nov 23 2022|
Promoters And Management:
Financials of Inox Green Energy Services Limited IPO:
|Particulars (in crores)||Jun-22||Mar 22||Mar-21|
|Revenue from operations||61.00||172.00||172.00|
|O&M and Common infrastructure facility expense||18.00||48.00||53.00|
|Purchases of stock-in-trade||15.00||22|
|Changes in inventories||-7|
|Employee Benifit Expense||5||21||18|
|Profit (Loss) before tax||-15||-4||-13|
|Profit (Loss) for the period||-11||-4||-27|
Comparison With Peers:
Recommendation on Inox Green Energy Services Limited IPO:
Review and Recommendation of InoxGreen Energy by IZ team is 3/10
1. Inox Green is a major wind power operation and maintenance company in India. They are basically involved in the business of O&M services for wind turbine generators. 2. InoxGreen is a subsidiary of Inox Wind which is engaged in the business of manufacturing of Wind Turbines and other services related to Wind Energy. The Inox Wind is a loss making entity from last 5 years. Inox Wind is not even making money at the operational level and revenue is also constantly going down. 3. As of June 30, 2022 InoxGreen Energy has O&M services portfolio consisted of an aggregate 2,792 MW of wind farm capacity and 1,396 WTGs. 4. Pursuant to an exclusivity agreement dated December 17, 2021, between InoxGreen Energy and Inox Wind Limited, the Promoter and largest shareholder, they provide exclusive O&M services for all WTGs sold by Inox Wind Limited through the entry of long-term O&M contracts between the WTG customer and ourselves. So, They are totally dependent on Inox Wind for their revenues. 5. InoxGreen Energy revenue has increased from 172 Crores to 190 Crores from Fy20 to Fy22 but due to high finance cost, & depreciation, the company is in loss. 6. Though company is in loss but operational level company has generated a cash of 361 Crores in Fy20, 48 Crores in Fy21 and 141 Crores in Fy22. 7. Nothing much in the company to excite for investment purpose. The financials profile is very weak for promoters and for the IPO company also.