Here are the various Brokerage Recommendations to the IPO of
Inox WindAngel Broking Research Analyst Shrenik C. Gujrathi wrote,
On EV/sales, the company is valued at 3.3x (at the upper end of the price band) on the basis of 9MFY2015 annualized numbers. Looking at the strong order book of the company and government focus on the sector, we recommend a Subscribe on the issue.
IndiaNivesh Research has the following Recommendation,
We recommend investors to Subscribe the equity issue of Inox Wind, taking into consideration 1) huge potential in the wind energy market in India and 2) fair valuation compared to peers. We believe Inox wind is good stock to play the wind energy sector theme in India as currently there is only one listed player (Suzlon) in this sector.
Motilal Oswal Analysts Satyam Agarwal & Amit Shah said,
We recommend Subscribe. We expect IWND’s WTG sales to increase from 330MW in FY14 to ~600MW in FY15 and 1-1.2GW in FY16. O&M business also provides interesting growth possibilities. Serious government intent to push renewable power is a key driver
GEPL Capital has the following View,
Inox Wind Ltd. stands to gain from operating leverage. At a P/BV of 1.54x we believe that Inox Wind demands a discount to both its domestic peers. We assign a Subscribe rating to the IPO.
ShareKhan has the following Views,
At the offer price, IWL is valued at 19-20x its historic earnings on an enterprise value/earnings before interest, tax, depreciation and amortisation basis. On a rough and conservative basis, the valuation works out to around 10x FY2017 estimate, which is much below the prevailing average valuation of 15-16x of the listed players globally. Moreover, with its listed domestic peer, Suzlon Energy, struggling with debt and profitability issues, IWL would emerge as one of the few quality companies listed in the renewable energy space and thus attract the scarcity premium.
K R Choksey Analyst, Ankush Mahajan said,
Considering above factors and government thrusts on renewable, IWL is well positioned to grow at a very healthy rate over the next few years. However, the management has shown execution capabilities to deliver 16% EBITDA margins and ~30% RoE in 9mFY15. At the offer price, IWL is valued at 17x earnings on an EV/EBITDA basis.
Nirmal Bang Analyst Runjhun Jain told us,
On the valuation front, the PER stands at 24.9-25.8x FY15E EPS of Rs 12.65 per share. Given the cyclical trend witnessed in the earlier quarterly results, we expect company to emulate minimum its Q3FY15 performance in Q4FY15, forming the basis of our valuation assumption. We recommend subscribing the issue as it may have good listing gains.
ICICI Direct Analysts Chirag Shah and Anuj Upadhyay has the following view,
With an established in-house manufacturing capacity and robust growth outlook, we believe IWL is on a strong growth footing. Though optically the stock is trading at 54x on FY14 PAT, we believe the underlying earnings growth (indicated by 1258 MW of backlog) in FY15E-17E and thrust of the government on renewables will make valuations look attractive. It does provide investors an opportunity to invest in a pure play renewable energy company. Hence, we recommend SUBSCRIBE
Aditya Birla Money Analyst Shreyans Mehta has the following view,
We expect IWL’s sales to be ~0.85GW for FY16 & our back of the envelope calculations estimate the stock to be trading at ~11x its FY16 (E) EPS of `30 and 9.7x its FY16 (E) EV/EBITDA. Given a) Robust business model and promoter group b) Return ratios and c) capex requirement of this business we believe, IWL is fairly valued. However, given the current governments thrust on renewable energy and lack of quality paper in the industry in which IWL operates, there is a high probability of listing gains. Hence, we recommend “Subscribe” on IWL IPO for short term and medium term investors.
