Bajaj Energy Limited IPO - Details

Bajaj Energy Limited filed its draft red herring prospectus with the market regulator SEBI (Securities and Exchange Board of India) in 2019. Now, it has received the approval to launch its IPO to raise a fund of Rs. 5,450 crores. The initial share sale of Bajaj Energy Limited will contain both a fresh issue of equity shares and an OFS. 

This fresh issue component of this public offering will amount to Rs. 5,150 crores, whereas the offer for sale (OFS) will be Rs. 300 crores. To find more details of this initial public offering, have a glance at the following table:

Issue Type

Book Built

Listing at

BSE and NSE

IPO Price Band

To be updated

Face Value

₹10

per equity share

Market Lot

To be updated

Minimum Order Quantity

To be updated

Issue Type

Book Built

Listing at

BSE and NSE

IPO Price Band

To be updated

Face Value

₹10

per equity share

Market Lot

To be updated

Minimum Order Quantity

To be updated

Listing at NSE, BSE

Important Dates for Bajaj Energy Limited IPO

IPO opens on To be updated
IPO closes on To be updated
Basis of Allotment publication date To be updated
Credit of shares to Demat Account To be updated
Initiation of Refund To be updated
IPO listing To be updated

View all upcoming IPOs

About Bajaj Energy Limited

Founded in 2008, Bajaj Energy Limited is one of the largest private sector power thermal generation companies in Uttar Pradesh, India. It holds several years of experience in running, building and financing power generation facilities. In fact, the company has successfully set up a thermal power generation capacity of 2430 MW that runs on coal. 

450 MW of this capacity comes from 5 plants spread across 5 locations in the state. The owner of these plants is BEL. On the other hand, the rest of 1980 MW comes from plants owned by LPGCL. Further, Bajaj Energy Limited is making an effort to increase its demand. For this purpose, it plans to add conventional power generation capacity in the next two years. With SEBI’s nod, Bajaj Energy Limited now plans to float its initial public offering.

Objectives of Bajaj Energy Limited IPO

The following are the objectives that Bajaj Energy Limited is planning to fulfil from the funds collected through IPO:

  • Repayment or advance payment of the company debts

  • To fund the purchase of 6,99,36,900 shares of Lalitpur Power Generation Corporation from Bajaj Hindustan Sugar and Bajaj Power Generation. It will amount to Rs. 4,972 crores. 

  • For general corporate purposes

Why Should I Invest in Bajaj Energy Limited IPO?

Individuals looking forward to participating in the initial public offering of Bajaj Energy Limited can consider the following reasons to invest in it:

  • There is a high chance of increasing demand for power supply after it completes the electrification of 100% of the villages. 

  • The company has a successful track record in carrying out its operation, i.e., building, financing and running thermal power plants.

  • Bajaj Energy Limited has a management team with years of experience. 

  • This company has a long-term fuel agreement established with Central Coal Fields Ltd. that will continue for years. 

  • At Bajaj Energy Limited, the professionals follow sustainable operational practices giving this company a competitive edge. 

  • This firm has received awards for its safety measures in 2015, 2016, and 2017. Also, the authorities have recognised it for having the best water-efficient plant under the 500 MW category.

Financial highlights

Find the financial details of Bajaj Energy Limited as mentioned in its DRHP registered with SEBI in the following table:

Financial Year Total Assets in Millions Total Income in Millions Profit After Tax in Millions
FY 2018 Rs. 34,741.55 Rs. 8,976.25 Rs. 416.82
FY 2017 Rs. 36,840.97 Rs. 14,058.76 Rs. 882.50
FY 2016 Rs. 35,900.48 Rs. 14,070.99 Rs. 1,028.35

How to Apply for Bajaj Energy Limited IPO?

There are two simple ways through which interested investors can put their bids on the shares of this company. One is via UPI, and the other is through the Demat account. Both the procedures are mentioned below:

UPI

One can choose to trade directly through his or her UPI ID. However, the first step one needs to follow is setting up his or her UPI account by linking the ID to the preferred bank account. Next, the individual needs to connect this UPI with the Angel One platform. The sign-up process is simple, and once completed, it allows users to subscribe to shares of any company with just a click.

Demat Account

The second way to apply for the IPO of Bajaj Energy Limited or any other public issue is by opening a Demat Account through the Angel One platform. Individuals just need to fill in essential personal details, and their accounts get set up in no minute. Not only this, but it also does not require extensive documentation to start trading. So, first-time investors looking for a straightforward way to subscribe to company shares can find this portal useful. 

Bajaj Energy Limited IPO – Noteworthy Highlights

The following are the noteworthy highlights of Bajaj Energy Limited that this company has established over its course of operation. Make sure to go through them to make a firm investing decision:

  • Bajaj Energy Limited is the top name when talking about well-established private sector power producers in UP.

  • It holds enough plants to meet the increasing demand of the state.

  • The company has operational power plants of 2430 MW capacity, as mentioned in its DRHP. 

  • Bajaj Energy Limited has also secured the gold award in maintaining industrial safety by Green Tech Foundation. 

  • In addition, this company maintains a sustainable method of operation for the overall benefit of society. 

Bajaj Energy Limited IPO SWOT Analysis

Strength

    • The company is to complete 100% electrification of villages, due to which it expects a soaring demand. 

    • Bajaj Energy Limited has a highly-versed management team holding years of experience. 

    • It has registered a long term-agreement with Central Coal Fields Ltd. for fuel supply. Central Coal Fields Ltd. is a subsidiary of Coal India Ltd. 

    • The company has the trust of its customers when it comes to building, financing and running thermal power plants. 

    • Bajaj Energy Limited has a high coal-based thermal power generation capacity, i.e., 2,430 MW. Under this, it has 5 plants of 450 MW in five different locations of UP and other power plants sourcing the rest 1,980 MW capacity. 

Weakness

    • The customer base of Bajaj Energy Limited is from Uttar Pradesh, thus making them highly dependent. 

    • The selling rate of generated power supply is not in the hands of BEL or LPGCL. Rather, it is the UPERC that decides the rate. So, if any policy change creates a spike in price, the company cannot align the cost with its price, leading Bajaj Energy Limited to a loss. 

    • There is always a risk relating to environmental damage and pollution regarding thermal power production. 

    • It has defaulted several times in paying back loans. 

Opportunity

    • Bajaj Energy Limited stands a better chance of gaining more demands in future since the population of Uttar Pradesh is high. 

    • The coal-based capacity of the company is expected to rise 81% from its current conventional power generation capacity for the Fiscal year 2019 to 2023. 

    • Bajaj Energy Limited also plans to focus on operational efficiency, thus standing a chance to increase its asset value along with portfolio expansion and efficient capital structure. 

    • It plans to buy 6,99,36,900 equity shares, i.e., 79.31% of LPGCL from Bajaj Hindustan Sugar Ltd. and Bajaj Power Ventures Private Ltd., having a fair value of Rs. 10. Thus, it has a significant expansion scope in future. 

Threats

    • Bajaj Energy Limited is currently involved in an open dispute with UPPCL regarding payment tariffs. If this dispute goes against LPGCL, it will have to write off profits for 2018. 

    • For thermal power generation, the company needs an ample supply of coal. If not, it can disrupt fuel supply and cause transportation and supplier issues. 

Competitive Analysis – Market Peers of Bajaj Energy Limited

Individuals can find the top competitors of Bajaj Energy Limited, along with their market capitalisation and percentage of profit growth, in the table below.

Company Name

Market Capitalisation

PAT Growth %

Tata Power Company Limited

Rs. 81,001.86 crores

58.31%

NTPC Limited

Rs. 1,60,916 crores

20.58%

JSW Energy Limited

Rs. 58,001.44 crores

(13.71)%

Torrent Power

Rs. 26,914.54 crores

23.85%

Frequently Asked Question

What is the holding percentage of LPGCL shareholders?

The following are the percentages that different shareholders of LPGCL own:

  1. BPVPL holds 61.80% 

  2. BEL holds 20.69%

  3. BHSL holds 17.51%

When did the company file DRHP and receive a nod from SEBI?

Bajaj Energy Limited filed its DRHP with the Securities and Exchange Board of India (SEBI) in April 2019. However, it received the market regulator’s nod in September 2019 to launch its IPO in 2021. 

Who are the lead managers of Bajaj Energy Limited IPO?

The following are the lead managers of Bajaj Energy Limited IPO:

  • IIFL Holding Limited 

  • Edelweiss Financial services Limited

  • IDBI Capital Markets & Securities Limited

  • SBI Capital Markets Limited

Who are the promoters of Bajaj Energy Limited?

The following are the promoters of Bajaj Energy Limited:

  • Shishir Bajaj

  • Bajaj Power Ventures private Limited

  • Kushagra Bajaj

  • Apoorva Bajaj

  • Minakshi Bajaj

What is the price band for this initial public offering of Bajaj Energy Limited?

Bajaj Energy Limited has not yet disclosed the price band for its initial share sale. 

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