Centre directs energy PSUs to list green energy business
Notable because
Following the announcement of the 50 GW per year RE bidding trajectory in March 2023, the pace of tendering has increased considerably, with 47.5 GW tendered in FY24. With equity accounting for ~25% of the project-level capital structure, PSU developers may pursue the IPO route to raise equity capital. Further, separating out green businesses may allow the unlocking of greater value, with recent clean energy–focused listings achieving superior valuations relative to their conventional counterparts.
What to look out for in the months ahead
With NTPC Green Energy having already filed its draft red herring prospectus (DRHP) with SEBI, which other PSUs will take the IPO route going forward?
What kinds of valuations will these listings realise relative to their peers in fossil fuel–based businesses?