NTPC Green Energy Files for ₹10,000 Crore IPO, To Open in Nov 1st Week

NTPC Green Energy, the renewable energy arm of state-run NTPC, has submitted draft papers to the Securities and Exchange Board of India (SEBI) to raise ₹10,000 crore through an initial public offering (IPO). The entire IPO consists of a fresh issue of equity shares, with no offer-for-sale (OFS) component, according to the draft red herring prospectus (DRHP).

The company plans to use ₹7,500 crore of the IPO proceeds to repay or prepay loans of its subsidiary, NTPC Renewable Energy Ltd (NREL), while the remaining funds will be allocated for general corporate purposes.

Expected Launch Date

Media reports suggest that the NTPC Green Energy IPO is likely to open in the first week of November. The company has planned investor roadshows in India, particularly in Mumbai, and internationally, with a focus on Singapore.

A portion of the IPO will be reserved for NTPC shareholders. Investors who hold NTPC shares on the record date of the RHP (which will be filed later) will be eligible to participate in this category.

To maximize chances of securing an allotment in the IPO, investors can buy at least one NTPC share now. This will make them eligible for the shareholders’ quota when the IPO launches. Those holding NTPC shares as of the record date can apply under this preferential category.

NTPC Green Energy: A ‘Maharatna’ PSU

NTPC Green Energy, a ‘Maharatna’ central public sector enterprise, manages a portfolio of renewable energy assets, including solar and wind power projects across six states.

As of August 2024, the company operates 3,071 MW of solar projects and 100 MW of wind projects. The broader NTPC group has set an ambitious goal of reaching 60 GW of renewable energy capacity by 2032. Currently, the group has 3.5 GW of installed capacity with over 28 GW in development.

India’s renewable energy sector has seen significant growth in recent years, positioning the country as the fourth-largest globally in renewable energy capacity, which includes wind and solar power. The draft papers, citing a Crisil report, state that India’s renewable energy capacity grew from 63 GW in FY12 to 191 GW by March 2024, including large hydro. As of March 2024, renewable energy accounts for nearly 43% of India’s total power generation capacity, with solar energy leading the way.

IDBI Capital Markets & Securities, HDFC Bank, IIFL Securities, and Nuvama Wealth Management are the lead book-running managers for the IPO. Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, highlighted that the IPO comes at a critical time as NTPC looks to diversify its revenue streams by moving away from its dependence on thermal power.

“With green energy gaining focus in the near future, investors are likely to be keen on getting a slice of this pie,” Bathini told Reuters.