Fujiyama Power IPO Opens: Rs 828 Crore Bet on Solar Growth – Huge Opportunity or Hidden Risks? Click to Reveal!

Renewables

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Updated on 13 Nov 2025, 10:05 am

Fujiyama Power Systems launched its Rs 828 crore Initial Public Offering (IPO) today, inviting investors at a price band of Rs 216 to Rs 228 per share. The issue comprises a fresh issuance of Rs 600 crore and an offer for sale of 1 crore shares. The company secured Rs 247 crore from anchor investors prior to the opening. Funds raised will primarily be used for establishing a new manufacturing plant in Ratlam, Madhya Pradesh (Rs 180 crore), and for repaying borrowings (Rs 275 crore), with the remainder for general corporate purposes.

Fujiyama Power Systems, with 28 years of experience, is a significant player in the rooftop solar market, offering diverse products like inverters, panels, and batteries under its UTL Solar and Fujiyama Solar brands. Its strengths include a vertically integrated model, expanding manufacturing capacity across four existing facilities, and a vast distribution network spanning 725 distributors and over 5,546 dealers nationwide. The planned Ratlam facility aims to boost production capacity for solar panels, inverters, and batteries, facilitating expansion into western and southern India.

The Indian rooftop solar market is poised for substantial growth, projected at 40-43 percent CAGR from FY25 to FY30, driven by government policies, increased awareness, and falling technology costs. Fujiyama is well-positioned to capitalize on this trend with its comprehensive product range and extensive distribution. Financially, the company has shown robust growth, with revenues soaring to Rs 1,540.7 crore in FY25 from Rs 664.1 crore in FY23, and net profits escalating to Rs 156.3 crore from Rs 24.4 crore in the same period, while maintaining double-digit operating margins.

However, analysts highlight key risks. A significant concern is the heavy reliance on imported raw materials, with 92 percent sourced from China, exposing the company to supply chain vulnerabilities and policy changes. Furthermore, Fujiyama's business is heavily dependent on government subsidy programs for rooftop solar adoption; any reduction or delay in these incentives could impact demand. Other risks include high working-capital requirements, concentrated manufacturing in northern India, and competition from lower-cost suppliers.

Impact: This IPO is significant for investors interested in the renewable energy sector and the Indian stock market, as it offers a new investment avenue in a high-growth industry but comes with sector-specific and operational risks. Rating: 7/10

Difficult Terms Explained: * Initial Public Offering (IPO): The first time a private company offers its shares to the public to raise capital. * Anchor Investors: Large institutional investors who commit to investing in an IPO before it opens to the public. * Fresh Issue: When a company issues new shares to raise fresh capital. * Offer for Sale (OFS): When existing shareholders sell their shares in the company. * Manufacturing Facility: A factory where products are produced. * Debt Repayment: Paying back loans or borrowed money. * General Corporate Purposes: Funds used for everyday business operations and general expenses. * Vertically Integrated Model: A business strategy where a company controls multiple stages of its production process, from raw materials to finished goods. * Distribution Network: The system a company uses to deliver its products to customers. * CAGR (Compound Annual Growth Rate): The average annual growth rate of an investment over a specified period, assuming profits are reinvested. * Subsidy Programs: Financial assistance provided by the government to encourage specific activities, like solar energy adoption. * Working Capital Intensity: A measure of how much capital is needed to cover a company's day-to-day operating expenses. * Procurement: The process of acquiring goods or services.