Powerica shares list at 7% discount to IPO price on BSE, NSE

In a weak market debut, shares of Powerica listed with 7% discount to the IPO price on Thursday. The stock opened at Rs 366 and Rs 375 on NSE and BSE, respectively, as compared to its issue price of Rs 395.

The Rs 1,100 crore IPO, which was a mix of a fresh issue and an offer for sale, saw an overall subscription of 1.53 times, reflecting lukewarm demand across investor categories.

Retail demand sharply weak

The most notable aspect of the subscription data was the sharp drop in retail participation. The retail portion was subscribed just 0.16 times, indicating a near absence of interest from individual investors. Non-institutional investors (NIIs) also remained cautious, with their portion subscribed only 0.47 times. In contrast, qualified institutional buyers (QIBs) showed strong interest, subscribing 5 times, helping the issue cross the fully subscribed mark.

The strong QIB participation suggests confidence in the company’s fundamentals and long-term prospects. However, the lack of broader investor participation points to valuation concerns and a cautious approach in the current IPO market.

About the company

Powerica, which operates in the power solutions segment with a focus on diesel generator sets and wind energy projects, is positioned across both conventional and renewable energy segments.

While the company has reported steady financial performance, including revenue of over Rs 2,700 crore and profit after tax of Rs 175.83 crore in FY25, its financials have shown some inconsistency over time, which may have weighed on investor sentiment.

Use of proceeds and valuation

A large portion of the IPO proceeds -- about Rs 525 crore -- will be used for debt repayment, with the rest allocated to general corporate purposes.

Analysts said the issue was reasonably priced relative to peers, with a post-issue price-to-earnings multiple of around 18.6 times.

The 2% GMP signals that listing gains, if any, are likely to be limited. The weak retail response further reduces the likelihood of a sharp debut pop.

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