NTPC Green Energy, the renewable energy arm of NTPC, has managed to get ₹3,960 crore from anchor investors before its ₹10,000 crore Initial Public Offering. Now, with the price band fixed at₹102 to₹108 per share, the public subscription period will be held from November 19 to November 22, 2024. From the IPO proceeds, this time NTPC will also focus more on debt repayment besides supporting other corporate requirements since it strives towards aggressive expansion in its renewable energy business.
The IPO, solely a new equity issue with no OFS element, has already attracted considerable interest. From what appears in the circular uploaded to the BSE website, 36.66 crore equity shares had been allotted to 107 anchor investors at ₹108 per share—a price band upper limit. New World Fund Inc., Goldman Sachs Funds, Government of Singapore, Life Insurance Corporation of India, ICICI Prudential Mutual Fund, Nippon India Mutual Fund, DSP Mutual Fund, and Kotak Mutual Fund are the principal anchor investors.
The IPO aims to raise ₹7,500 crore to pay for or prepay the outstanding loans of its subsidiary, NTPC Renewable Energy Ltd, which is a ‘Maharatna’ central public sector enterprise. Part of the proceeds would also be utilized for general corporate purposes.
NTPC Green Energy is classified as a ‘Maharatna’ central public sector enterprise with a diversified portfolio of renewable energy, including solar and wind-based power plants. As of August 2024, its operational capacity includes 3,071 MW of solar and 100 MW of wind energy spread across six states. The company forms a critical part of NTPC Group’s vision to achieve 60 GW of renewable energy capacity by 2032. As of today, the total installed renewable energy capacity of the NTPC Group is at 3.5 GW, while there are also more than 28 GW of projects under operation.
The renewable energy sector is growing so fast that India has become the fourth country worldwide to possess renewable energy capacity with wind and solar installations. An article in NTPC Green Energy’s draft papers cites a Crisil report noting that installed renewable energy capacity in India has grown by leaps and bounds, from 63 GW back in 2012 to about 191 GW by March 2024. Renewable energy now forms nearly 43% of the nation’s total power generation capacity, with solar energy contributing enormously to this development.
The IPO is led by book-running lead managers IDBI Capital Markets & Securities, HDFC Bank, IIFL Securities, and Nuvama Wealth Management. NTPC Green Energy’s IPO will grab adequate attention in the increasingly focalized global scenario of sustainability and clean energy.
Conclusion
NTPC Green Energy’s ₹10,000 crore IPO marks an important milestone in India’s renewable energy sector. The proceeds raised will further the financial strength and serve the ambitious aims of the NTPC Group regarding clean energy. Since India has emerged as a global leader in the field of renewable energy, this IPO bears testimony to the strategic role of public investment in India’s sustainable development.
Source: PTI