India's Azure Power applies for New York IPO

Azure Power, the pioneering Indian solar developer, applied to list shares on the New York Stock Exchange, saying it will take in net proceeds of $114m if its shares sell at the midpoint of the initial public offering range of $21-$23.

Azure built India’s first utility-scale PV plant in 2009, and it expects to own 520MW of operating capacity in the country by the end of 2016, including a handful of rooftop arrays on commercial and industrial properties.

The company is targeting 5GW of projects on its books – either in operation or with a signed PPA – by the end of 2020.

Azure first filed paperwork related to the IPO last December, but it has now set the wheels in full motion, bringing on Barclays and Credit Suisse as joint book-runners, and Roth Capital Partners as co-manager of the offering.

Azure itself intends to sell 5.86 million equity shares, while other shareholders will unload 955,000 shares. The underwriters have the option of buying another 1 million shares at an IPO price.

If the shares sell at $22 apiece, Azure would have a fully diluted market value of $516 million.

The shares – which will trade on the New York Stock Exchange under the ticker symbol AZRE – will offer a new way for investors to own a piece of the action in India’s solar market, which will explode over the next few years if the country comes anywhere close to its 100GW solar target for 2022.

India had just under 7GW of installed solar at the end of March.

Azure posted a net loss of 1.65bn rupees ($25m) in its 2016 fiscal year ending on 31 March, up from 1.1bn rupees in 2015, and the company expects to continue losing money for the foreseeable future while it invests in amassing a base of generating solar assets.

The India-based company took in revenues of $38.9m last year on sales of power.

As of 31 July, Azure says it owned 24 utility-scale projects and several rooftop arrays totaling 357MW, and it had another 258MW with signed PPAs.

The company typically signs 25-year PPAs with a variety of off-takers, including government utilities like the Punjab State Power Corporation, and a growing list of C&I clients.

Azure claims new utility-scale solar power in India is competitive today with wind, new thermal capacity using imported coal, and the retail power price for commercial users.

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