Rays Power Infra Takes a Big Step Towards IPO: Files DRHP with SEBI

Rays Power Infra, a prominent player in the Indian solar power industry, has taken a significant step towards going public. The company filed a draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) on January 2, 2024, signaling its intention to raise capital through an initial public offering (IPO).

The Rays Power Infra IPO is set to include a fresh issue of shares valued at Rs 300 crore, along with an offer-for-sale (OFS) of 29.95 lakh shares, each with a face value of Rs 10. Promoters of the company, including Ketan Mehta, Sanjay Garudapally, and Pawan Kumar Sharma, will participate in the OFS. Ketan Mehta plans to sell up to 14.47 lakh shares, while Sanjay Garudapally and Pawan Kumar Sharma will each offload 7.78 lakh shares.

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The primary objective behind raising funds through this IPO is to strengthen the company’s working capital and support general corporate purposes. Rays Power Infra aims to generate a net revenue of Rs 210 crore from the IPO, with the remaining funds serving various corporate needs.

Anand Rathi Advisors has been appointed as the book-running lead manager for the IPO, and Bigshare Services will serve as the registrar. The company intends to list its equity shares on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

It’s important to note that Rays Power Infra faces some challenges, including the absence of trademark registration for its name and logo. Additionally, a substantial portion of the company’s revenue comes from a limited number of customers, which may pose risks.

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Despite these challenges, Rays Power Infra has displayed impressive financial growth. In the fiscal year ending March 2023, the company’s net profit skyrocketed by over 1,500 percent, reaching Rs 131 crore from Rs 8 crore in the previous fiscal year. During the same period, revenue from operations increased from Rs 544.42 crore to Rs 776.5 crore. In the preceding fiscal year (FY21), the company reported a loss of Rs 10.6 crore, with revenue standing at Rs 366.27 crore. For the year ending June 30, 2023, the profit after tax amounted to Rs 2.48 crore.

Rays Power Infra is contemplating a pre-IPO placement, which may involve the issuance of shares, including private placements, raising up to Rs 45 crore, or a secondary sale of up to 14.97 lakh shares by selling shareholders. The amount garnered from the pre-IPO placement will be deducted from either the fresh issue or the OFS portion of the IPO.

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Rays Power Infra IPO

Rays Power Infra has established itself as an early mover in the solar park sector and has evolved into a prominent player in turnkey solar engineering, procurement, and construction (EPC) services. With a track record of implementing solar power projects totaling 1,207 megawatts peak (MWp), the company is one of India’s leading integrated solar power companies.

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