NTPC Green Energy IPO 2024 Highlights: Check GMP, review, listing date, and other things

Kfin Technologies, the registrar of the IPO, will finalize share allotment by November 25. Investors can check their allotment status through the registrar’s website or other official channels.

The IPO price band is set between Rs 102 and Rs 108. This pricing strategy provides a framework for buyers to place bids within the specified range, helping gauge demand during the subscription period.

NTPC Green Energy is commanding a 0.93% premium in the grey market, indicating a potential listing price of Rs 109. Investors anticipate lacklustre listing gains, reflecting current market volatility and cautious investor sentiment.

The much-anticipated NTPC Green Energy IPO opens on November 19 and closes on November 22. The company aims to raise Rs 10,000 crore by issuing 92.59 crore fresh shares. This marks a key event in the renewable energy sector.

India‘s renewable energy capacity has expanded five-fold over the past decade, touching approximately 201GW as of Sep 2024-end. Solar energy alone accounts for 44% (89GW) of this capacity, reflecting a massive surge from just 0.09GW in 2012.

The company’s contracted and awarded capacity of 13,576MW spans additional high-resource regions, with Rajasthan (33.36%) and Gujarat (37.17%) featuring prominently. These states, known for their abundant solar and wind potential, are pivotal to India’s renewable energy ambitions.

Shares of NTPC Green Energy were fetching a premium of 0.93% in the grey market, indicating a listing at Rs 109 per equity share. The grey market is an unofficial place to trade shares.

“We believe NTPC Green Energy IPO brings investors an opportunity to invest in a leading player of India’s renewable energy sector, backed by the formidable resources and expertise of NTPC. We think with a robust portfolio of 26,071 MW, including operational, contracted and pipeline projects, the company demonstrates strong growth potential. Its focus on long-term Power Purchase Agreements (PPAs) with government and public utilities ensures stable revenue streams, while its diversified geographical presence mitigates risk,” said Rajan Shinde, Research Analyst at Mehta Equities.

The company will be utilising the raised funds for investment in the wholly owned subsidiary, NTPC Renewable Energy, for payment of borrowings availed by the company and other general corporate purposes.

“The company is a leading renewable power generating PSU with assets in solar and wind power generation. It is also expanding into hydroelectric assets and emphasizing power storage plans. Although the company has posted net profits for the reported financial periods, the IPO is considered aggressively priced based on FY25 annualized earnings,” said Bajaj Broking in an IPO note.

“At the upper price band of Rs 108, NGEL is valued at FY24 EV/EBITDA of 53.4x on post issue capital. The company will increase its operational capacity to 6/11/19 GW by FY25E/FY26E/FY27E respectively from 3.3 GW as of Sep’24,” said Gaurav Garg, Research Analyst at Lemonn.

“Based on FY25 annualized financials, the IPO’s higher band implies

an EV/EBITDA of 43x, and a P/BV of 4.9, which is at a premium to its peers, in our view. Adani Green trades at EV/EBITDA of 31x and P/BV of 22, while Acme Solar Holdings trades at EV/EBITDA of 18.3x and P/BV of 5.5,” said InCred Equities in an IPO note.

NTPC Green Energy, a subsidiary of NTPC, India’s largest integrated energy company with over 76GW of installed capacity, is among the top 10 renewable players in India. At the forefront of NTPC’s renewable transition, NGEL targets 60GW of renewable energy capacity by 2032F, scaling operational capacity from 3.3GW in Sep 2024 to 6GW by FY25F, 11GW by FY26F, and 19GW by FY27F.

“If we attribute annualized FY25 earnings to a post-IPO fully diluted equity base, then the asking price is at a P/E of 257.14 and based on FY24 earnings, the P/E stands at 263.41. Thus the issue appears aggressively priced. But considering its current established capacities and future expanded capacities, this is a pure long-term story. As clarified by the management, the company has no impact on US policy on renewable energy as it has operations only in India,” said Bajaj Broking in an IPO note.