Danish Power IPO: Review, Valuation, Date & GMP

Danish Power IPO is India’s largest SME IPO, offering a book-built issue of Rs. 197.90 crore. Danish Power Limited, established in 1985, produces various transformers, including inverter duty transformers for wind farms and solar power plants, as well as power and distribution transformers. Their product range includes substation automation services and control relay panels.

Key Product Categories

• Transformers: Includes inverter duty transformers up to 20 MVA for solar plants and power transformers up to 63 MVA.

• Control Panels: Offers LT Panels, SCADA systems, and control relay panels up to 400 kV class.

The company operates two manufacturing facilities in Jaipur, certified with ISO standards for quality, safety, and environmental management. Major clients include Tata Power Solar, ABB India, and Torrent Power.

IPO Details

• IPO Dates: October 22 to October 24, 2024

• Issue Price: Rs. 360 to Rs. 380 per share

• Listing Date: October 29, 2024

• Exchange: NSE and SME

• Issue Size: 52.08 lakh shares, totaling Rs. 197.90 crore

Financial Highlights (as of June 2024)

• Total Assets: Rs. 20,639.09 lakh

• Total Revenue: Rs. 7,273.29 lakh

• Net Worth: Rs. 9,201.38 lakh

Danish Power aims to use IPO proceeds for capital expenditure, working capital, and loan repayment. The IPO’s valuation, with a P/E ratio of 14.45x, appears undervalued compared to the industry average of 48.14x.

Strengths and Risks

Strengths:

• Established manufacturing sites

• Diverse product portfolio

• Experienced management team

Risks:

• Geographic concentration

• Dependency on renewable energy sectors

• Price volatility of raw materials

Conclusion

Danish Power IPO presents a promising opportunity with its focus on the renewable energy sector. The company’s valuation seems attractive when compared to its industry peers, making it a potential value investment for investors.