Fresh Issue of Rs 400 crore & OFS of Rs 64.26 crore: Solar pumps manufacturer-GK Energy Get Listed on BSE & NSE Above Issue Price

On Friday, shares of GK Energy Ltd marked their debut on the stock exchanges, namely BSE and NSE. On BSE, the stock is listed at Rs 165 per share and on NSE, the stock is listed at Rs 171 per share. The IPO was oversubscribed 93.58 times overall. The QIB portion saw the highest subscription at 193.01 times, followed by retail investors at 21.78 times and Non-Institutional Buyers (NIIs) at 128.56 times.

The initial public offering (IPO) for GK Energy Limited, a renewable energy-focused Engineering, Procurement, and Construction (EPC) company specialising in solar-powered irrigation pump systems. The company has established a price band of Rs 145 to Rs 153 per share for the issue. The IPO aims to raise Rs 464.26 crore, which includes a fresh issue of Rs 400 crore primarily intended to fund working capital and a Rs 64.26 crore Offer for Sale (OFS). Investors can apply for a minimum lot size of 98 shares, with the tentative listing date on both the NSE and BSE scheduled for September 26, 2025.

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GK Energy is a key player in the solar irrigation pump market, heavily benefiting from the government's PM-KUSUM scheme, which contributed over 80 per cent of its revenues in FY25. The company’s strong positioning aligns with the vast potential of the solar pump industry, which is projected to grow to Rs 3 lakh–Rs 3.2 lakh crore by FY29. However, its financial performance in FY25 showed signs of stress, with Net Profit falling to Rs 10.08 crore and Net Profit Margin at 3.53 per cent, alongside high receivables, underscoring its heavy dependence on timely government payments for its growth and liquidity.

Valuation-wise, the IPO is priced at a P/E ratio of 23.3x (at the upper band based on FY25 earnings), which appears reasonable when compared to listed peers like Shakti Pumps (26x) and Oswal Pumps (32.2x). While the company boasts a strong market position and favourable policy tailwinds, potential investors should weigh the significant policy risk associated with the PM-KUSUM scheme's scheduled expiry in 2026 and the inherent weakness in operating cash flows due to high receivables against the company's robust revenue growth potential in a rapidly expanding sector.

Disclaimer: The article is for informational purposes only and not investment advice.