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Investing.com - Bernstein SocGen Group has maintained its Outperform rating on ReNew Power (NASDAQ:RNW) with a price target of $8.80, following a revised acquisition offer from a consortium of investors. The stock, currently trading at $7.56 and near its 52-week high of $7.67, has shown impressive momentum with an 11% gain over the past week.
The consortium, which includes Masdar, CPPIB, ADIA, and the company’s Founder, has increased its non-binding offer to $8.00 per share from the previous $7.07 per share after completing comprehensive due diligence of ReNew Energy. The $2.75 billion market cap company maintains impressive gross profit margins of 91%, though InvestingPro analysis indicates it operates with a significant debt burden.
Bernstein SocGen analyst Nikhil Nigania noted that the revised offer remains below the firm’s fair value assessment of $8.80 per share, adding that they had expected a higher offer given "strong interest in solar PV business which has been a sweetener to existing renewable development business."
The current shareholding structure shows that most investors are either hedge funds that entered specifically anticipating a take-private offer or long-only funds that invested in the $5-7 range, with the exception of a few funds that entered at higher prices during the SPAC listing.
Three entities—JERA, Franklin Resources (NYSE:BEN), and Rubric Capital—control approximately 60% of the non-consortium vote according to Bloomberg data, making them crucial to reaching the 75% threshold required for the offer to proceed. For deeper insights into RNW’s valuation metrics and 12 additional exclusive ProTips, explore the comprehensive InvestingPro Research Report, part of our coverage of 1,400+ US stocks.
In other recent news, ReNew Energy Global PLC has released its unaudited financial results for the fourth quarter and full fiscal year ending March 31, 2025. The financial data, which was filed with the SEC, provides key performance indicators for investors and stakeholders. Additionally, ReNew Energy Global has entered into agreements to sell its solar and transmission assets to IndiGrid Infrastructure Trust for approximately $275 million. This transaction includes a 300 MW solar project in Rajasthan and a 276 circuit kilometers transmission project in Karnataka, with an anticipated cash inflow of about $80 million for ReNew.
Moreover, ReNew Energy Global has secured a $100 million investment from British International Investment PLC. This funding is aimed at constructing a new 4 GW solar cell facility in Gujarat and expanding the company’s business operations. The investment will result in BII acquiring an approximate 10% stake in ReNew’s solar manufacturing arm, contingent on future EBITDA. These developments highlight ReNew’s strategic moves in asset management and expansion within the renewable energy sector.
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