NEW DELHI: India is seeing a revival in clean-energy initial public offerings (IPOs) as companies capitalise on Prime Minister Narendra Modi’s push for renewables.
Starting with Vikram Solar Ltd this week, more than a dozen green-energy companies have lined up to go public, seeking to raise more than US$4bil in total, according to data from primedatabase.com and local media reports.
That comes after the sector saw no major offerings this year in a sharp slowdown from the US$2.4bil raised through IPOs last year. The wave of green listings comes on the back of a pickup in India’s broader IPO market after a slow start to the year.
A number of billion-US dollar deals are on their way, and top arranger Kotak Mahindra Capital Co expects companies to raise over US$30bil in the coming year.
Modi’s 2030 target to more than double clean-energy capacity to 500GW – nearly equivalent to all the power plants in Britain, France and Germany combined – fuelled a boom in green listings and share prices last year.
But overheated valuations and project delays caused the frenzy to cool, and now, the deal pipeline is regaining momentum as stock prices come off their lows.
“A perfect storm of policy clarity, proven technologies and global environmental, social and governance capital is powering India’s clean-energy IPO rush,” said Amit Ramchandani, managing director and chief executive officer at Motilal Oswal Investment Advisors.
“Demand for round-the-clock green power is accelerating storage-linked projects.”
Modi announced an ambitious target for the world’s third-largest emitter to reach net-zero emmissions by 2070 at the COP26 climate summit in November 2021.
As India ramped up production incentives, solar, electric vehicles and wind power suppliers mushroomed in the country, spawning listing candidates.
India’s installed clean-energy capacity – including nuclear power – reached 246GW in July, according to the New and Renewable Energy Ministry. — Bloomberg
