The NTPC Green Energy IPO is set to be a significant event in the renewable energy sector with a fresh issue of ₹10,000 crore, marking a notable move in India's energy market. The IPO consists of a book-built issue, comprising 92.59 crore shares, entirely through fresh issuance. It opens for public subscription on November 19, 2024, and closes on November 22, 2024, with the listing expected on both BSE and NSE on November 27, 2024. Investors are eagerly eyeing this opportunity given NTPC Green Energy's robust portfolio in solar and wind power projects, aimed at enhancing India's renewable capacity. through fresh issuance. It opens for public subscription on November 19, 2024, and closes on November 22, 2024, with the listing expected on both BSE and NSE on November 27, 2024. Investors are eagerly eyeing this opportunity given NTPC Green Energy's robust portfolio in solar and wind power projects, aimed at enhancing India's renewable capacity.
Key Details of the NTPC Green Energy IPO
- IPO Price Band: ₹102 to ₹108 per share
- Issue Size: ₹10,000 crore through a fresh issue of 925,925,926 shares
- Lot Size: Minimum 138 shares per application
- Minimum Investment for Retail Investors: ₹14,904
- Minimum sNII Investment: 14 lots (1,932 shares), equivalent to ₹208,656
- Minimum bNII Investment: 68 lots (9,384 shares), equivalent to ₹1,013,472.
The lead managers for the issue include Idbi Capital Market Services Limited, HDFC Bank Limited, IIFL Securities Ltd, and Nuvama Wealth Management Limited. Kfin Technologies Limited has been appointed as the registrar for the IPO, ensuring a smooth process for investors.
IPO Schedule and Listing Timeline
- Opening Date: November 19, 2024
- Closing Date: November 22, 2024
- Allotment Date: November 25, 2024
- Initiation of Refunds: November 26, 2024
- Shares Credited to Demat: November 26, 2024
- Listing Date: November 27, 2024
NTPC Green Energy Limited: Company Overview
NTPC Green Energy Limited, a wholly-owned subsidiary of NTPC Limited, was incorporated in April 2022 with a vision to expand its renewable energy footprint. As of August 31, 2024, the company boasts an operational capacity of 3,071 MW from solar projects and 100 MW from wind projects spread across six states. With a growing project pipeline, NTPC Green aims to play a pivotal role in India's transition towards clean energy.
Competitive Strengths:
- Strong backing from NTPC Limited, offering a solid financial base and extensive project execution experience.
- A robust portfolio of 14,696 MW, encompassing both operational and awarded projects in solar and wind energy sectors.
- Expertise in renewable energy project development, coupled with a seasoned team of professionals.
Financial Performance
NTPC Green Energy Limited has demonstrated impressive financial growth, with revenue surging by 1,094.19% year-over-year and profit after tax (PAT) growing by 101.32% as of March 2024. The company’s key financial metrics are as follows:
| Period Ended | Assets (₹ Cr) | Revenue (₹ Cr) | PAT (₹ Cr) | Net Worth (₹ Cr) |
|---|---|---|---|---|
| Sep 30, 2024 | 32,408.30 | 1,132.74 | 175.30 | 8,189.18 |
| Mar 31, 2024 | 27,206.42 | 2,037.66 | 344.72 | 6,232.14 |
| Mar 31, 2023 | 18,431.40 | 170.63 | 171.23 | 4,501.29 |
Key Performance Indicators (KPIs):
- Return on Equity (ROE): 7.39%
- Debt-to-Equity Ratio: 1.91
- Return on Net Worth (RoNW): 2.14%
- Price-to-Book Value (P/BV): 9.89
- PAT Margin: 16.2%
Investment Rationale
The IPO's objectives include raising funds for investments in NTPC Renewable Energy Limited (NREL) for debt repayment and general corporate purposes. Given the government’s focus on expanding renewable energy capacities, this IPO offers investors a chance to be part of India's green energy revolution.
Promoter Holding: The President of India, acting through the Ministry of Power, Government of India, and NTPC Limited, are the main promoters. The pre-issue shareholding stands at 100%, which will reduce post-issue, enhancing the company’s free float and market visibility.
Subscription Categories and Reservations
| Category | Shares Offered | Percentage of Net Issue |
|---|---|---|
| QIB | Not less than 75% | |
| Retail Investors | Not more than 10% | |
| NII (HNI) | Not more than 15% |
Retail investors can apply for a minimum of 1 lot (138 shares), while high-net-worth individuals (HNIs) have higher minimum lot requirements based on the sNII and bNII segments. The IPO offers a ₹5 per share discount for employees, making it an attractive proposition for insiders as well.
Peer Comparison and Market Outlook
The renewable energy sector is poised for substantial growth, driven by favorable government policies and increasing demand for clean energy solutions. NTPC Green Energy faces competition from other renewable energy companies but stands out due to its extensive project portfolio and backing from NTPC Limited. The company's focus on both organic and inorganic growth strategies further strengthens its market position.
Conclusion: Should You Invest?
The NTPC Green Energy IPO is a promising opportunity for investors looking to capitalize on the growth of renewable energy in India. The company’s strong financial performance, strategic project pipeline, and government backing provide a compelling case for investment. However, investors should consider market risks and conduct their own due diligence before subscribing.
For a detailed analysis and financial breakdown, refer to the NTPC Green Energy IPO Red Herring Prospectus (RHP).
Disclaimer:
The information provided in this article about the NTPC Green Energy IPO is for educational and informational purposes only. It does not constitute financial, investment, or legal advice. Investing in IPOs and the stock market involves risks, including the potential loss of principal. Readers are advised to conduct their own research and seek advice from a certified financial advisor before making any investment decisions. The data and projections presented are based on publicly available information and may be subject to change. The author and publisher are not liable for any losses or damages incurred from investments made based on this article.
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