Inox Wind Plans Public Issue

Inox Wind (IWL), a part of the Inox group, is set to venture into the capital markets with its public offering. The company intends to raise an amount of Rs 700 crore through this issue and also seeks to gain the benefit of being listed on the bourses.

The issue comprises an Offer For Sale by IWL's promoter Gujarat Fluorochemicals, which is selling 2 crore equity shares. Post this issue, the promoter holding will reduce from the current 75% to 62%. The issue will be based on the book-building method and the lead managers are Axis Capital, DSP Merill Lynch, Edelweiss Financial Services, YES Bank and Link Intime India.

Incorporated in the year 2009, IWL commenced operations in the year 2010. The company is engaged in manufacturing and marketing wind turbine generators. It also provides various services including wind resource assessment, site acquisition, infrastructure development, erection & commissioning and long-term maintenance of its wind power projects through its subsidiary Inox Wind Infrastructure Services (IWISL).

The company has a state-of-the-art manufacturing facility in Ahmedabad (Gujarat) and in Una (Himachal Pradesh). It manufactures blades and towers in its Ahmedabad plant, and the other plant produces hubs and nacelles. Currently, the company is developing five wind power projects with a capacity of 264 MW in Maharashtra and two in Gujarat with a planned capacity of 166 MW.

On a consolidated basis, IWL's revenues in FY13 stood at Rs 1063.68 crore, up from that of Rs 622 crore in FY12. The total revenues include income generated from manufactured products, as well as the sale of traded goods and services. During the fiscal, its operating expenses also went up by 80% to Rs 862 crore from that in the previous year.

However, the expenses as a percentage of the total revenue have increased just 4% in FY13 from that in FY12. This increase was mainly due to higher procurement & commissioning cost for the period, which rose by Rs 94 crore. The company’s bottomline saw growth of 50% to Rs 150 crore in the fiscal 2013 on a YoY basis.

IWL plans to invest the net proceeds of the issue in three major areas. First, to expand and upgrade its existing facility in Ahmedabad; secondly, to meet its capital requirements; and thirdly, to develop power evacuation infrastructure in its subsidiary IWISL. The planned amounts for the said objectives are Rs 153.8 crore, Rs 256 crore and Rs 125.66 crore respectively. IWL also intends to expand its blades production capacity to 400 per annum and the tower production capacity to 300 per annum, the existing capacities for which are 256 per annum and 150 per annum respectively.

The company will announce the issue price, offered fresh issue and issue date at a later point in its Red Herring Prospectus. Keep watching this space for more issue related details.