3:1 Bonus Allotment: Wind Energy Stock To Buy, Rs 193/Target By Nuvama; Board Meeting On May 31 For Fundraise

Heavy electrical equipment and Inox Group led wind energy company, Inox Wind is brokerage Nuvama's top pick as the company is one of the only two WTG and turnkey EPC companies in India.

Nuvama recommended BUY with a target price of Rs 193 on Inox Wind which recently turned ex-bonus in the ratio of 3:1. Also, the buy call comes ahead of its board meeting for considering the fundraising plan on May 31. There is potential for over 35% upside in this energy stock.

Notably, the company has also announced the allotment of free bonus shares to eligible shareholders.

INOX Wind Share Price:

This small-cap stock ended at Rs 142.80 apiece, down by 3.3% after market hours of May 29, with an m-cap of Rs 18,618.18 crore. The stock was near its 52-week high of Rs 177 despite the latest downfall, while traded as a multi-bagger with the upside of 328% from its 52-week low of Rs 33.35 apiece.

In six months, Inox Wind's share surged by 104%, while in a year, it is up by 319%.

Inox Wind Fundraising:

In its regulatory filing, it said, this is to inform you that a Meeting of the Board of Directors of Inox Wind Limited ('the Company') is scheduled to be held on Friday, 31st May 2024, inter-alia, to consider and approve proposal for raising funds by way of issuance of securities through preferential or on private placement basis, or any other methods or combination thereof as may be permitted under applicable law, subject to approvals from the shareholders, stock exchanges and other regulatory/ governmental authorities, as may be required.

Inox Wind Bonus Shares Allotment:

Inox Wind allotted an aggregate of 97,78,45,488 fully paid-up Bonus Equity Shares of Rs. 10/- (Rupees Ten) each by way of allotment of Bonus Equity Shares in the proportion of 3:1 i.e. 3 (Three) new fully paid-up Bonus Equity Shares of Rs. 10/- (Rupees Ten) each for every 1 (One) existing fully paid-up equity share of Rs. 10/- (Rupees Ten) each held by the eligible members whose names appeared in the list of beneficial owners as of 25th May 2024, being the Record Date fixed for this purpose.

Hence, Inox Wind carried bonus issues of 3:1 and turned ex-bonus on May 24.

Nuvama Target On Inox Wind:

In its research note, Nuvama said, "INOX Wind (INXW) is one of the only two WTG and turnkey EPC companies in India, wherein annual wind demand is reviving to more than 12GW. The revival is led by the spike in evening power demand (non-solar hours), catalysing RE tenders to move towards RTC/wind-solar-hybrid coupled with C&I demand from industrial consumers."

Also, the brokerage added, INXW defended a ~15% market share in a down-cycle. Reviving macros in a duopolistic wind EPC market shall enable it to achieve order book/revenue CAGR of 44%/73% (FY24-27E) led by: i) D/E reduction
to 0.6x (1.9x in FY24); ii) 2.5GW WTG/1.3GW EPC capacity; and iii) 30%-plus O&M services' EBITDA margin.

"Initiating at 'BUY' with a TP of INR193 at 30x WTG FY27E EPS (discounted to FY26E) of INR7.2 and DCF of O&M," the brokerage added.

About Inox Wind:

Inox Wind Limited (IWL) is India's leading wind energy solutions provider servicing IPPs, Utilities, PSUs & Corporate investors. IWL is a part of the US$ ~ 8 BN INOXGFL Group which has a legacy of over nine decades and is primarily focused on two business verticals - chemicals and renewable energy.

IWL is a fully integrated player in the wind energy market with four state-of-the-art manufacturing Plants in Gujarat, Himachal Pradesh and Madhya Pradesh, where Blades, Tubular Towers, as well as Hubs & Nacelles are manufactured. With its state-of-the-art 3 MW series WTG offering, IWL's manufacturing capacity stands at ~ 2.5 GW per annum.

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.