Bombay Stock Exchange has put on hold bidding for Solar91 Cleantech Ltd.'s Rs 106-crore initial public offering over questions raised in the media. The company's anchor bidding was supposed to take place on Dec. 23, and the public subscription was scheduled to open on Dec. 24, according to the company's red herring prospectus filed with the Registrar of Companies.
"It is hereby notified that in view of certain queries raised by complainants in media, same needs further examination," a BSE notice read. "In view of the same, pending further examination, the IPO bidding for anchor investors [...] and for public [...] is postponed till further notice."
The company, founded by IIT graduates in 2015, is engaged in engineering, procurement, and construction work with a current order book of 6.6 MW. It plans to swing into the independent power producer business, having already secured bids for 157 MW capacity in 2024.
From the proceeds of the IPO, the small-and-medium enterprise plans to use up to Rs 60 crore for investments in subsidiaries, and Rs 20 crore to fund working capital requirements.
Also Read: Which Are The Top 10 Most Subscribed SME IPOs? 2024 Sets New Record With NACDAC Infrastructure
Backlash On Social Media
Commenting on the use of proceeds, an X user said, "Most critical factor in this IPO is fund needed for the proposed project. And that point is being handled like trash!"
Another user, who apparently attended the company's IPO meet, said the promoters did not have answers for "so many queries regarding valuations."
Within the span of a month, Solar91 allotted shares at three different issue prices - Rs 24,430, Rs 29,730 and Rs 59,453. This implied that the valuation of the company soared nearly 150% within 30 days.
An X user, highlighting this, wrote, "It's quite strange, how can the company increase valuations by 2.5x in 1 month!!"
SME IPOs Under Increased Scrutiny
After Trafiksol ITS Technologies Ltd. and C2C Advanced Systems, this is the third SME IPO to come under scrutiny right ahead of its listing. Trafiksol had run into trouble with the Securities and Exchange Board of India, which then asked BSE not to proceed with the listing of the company. C2C, after launching one of the biggest SME IPOs this year, was forced to defer its market debut after intervention by the Sebi.
BSE's action against Solar91 follows Sebi's much-anticipated approval of tighter regulations for SME IPOs.
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