NTPC Green Energy's Massive IPO to Fuel Renewable Expansion

NTPC Green Energy, a subsidiary of NTPC, has filed for a Rs 10,000 crore IPO. The proceeds will primarily repay NTPC Renewable Energy Ltd's loans. As of August 2024, NTPC Green Energy boasts 3,071 MW from solar and 100 MW from wind projects, with a goal of 60 GW by 2032.

NTPC Green Energy, the renewable energy division of NTPC, filed preliminary papers with SEBI on Wednesday to raise Rs 10,000 crore via an initial public offering (IPO). Notably, the IPO represents a fresh issuance of equity shares with no offer-for-sale component, as outlined in the draft red herring prospectus (DRHP).

The company, which specializes in renewable energy, plans to allocate Rs 7,500 crore from the raised funds to repay or prepay loans of its subsidiary, NTPC Renewable Energy Ltd (NREL). A part of the proceeds will also be utilized for general corporate expenses. The timing capitalizes on a bullish IPO market, with nearly 60 companies launching their initial share-sales this year so far.

NTPC Green Energy, a 'Maharatna' central public sector enterprise, manages a renewable energy portfolio that includes solar and wind power projects across six states. Currently, the company operates 3,071 MW of solar and 100 MW of wind projects. By 2032, the NTPC group aims for 60 GW of renewable capacity, with 3.5 GW already installed and 28 GW in progress.

India's renewable energy sector is on a growth trajectory, positioned fourth globally in wind and solar energy capacity. Between FY12 and FY21, India's installed renewable energy capacity grew from 63 GW to 123 GW, reaching approximately 191 GW by March 2024. Renewable sources now account for nearly 43% of total power generation capacity, as per a Crisil report cited in the draft papers.

IDBI Capital Markets & Securities, HDFC Bank, IIFL Securities, and Nuvama Wealth Management are managing the book-running for this IPO.