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PremiumNTPC Green Energy IPO Day 2 LIVE Updates: The initial day of bidding for the government-owned NTPC Green Energy IPO commenced successfully on Tuesday, November 19, with a significant turnout of retail investors who fully subscribed to the segment. Before the IPO launch, NTPC Green Energy had garnered ₹3,960 crore from anchor investors. On its first day, NTPC Green Energy, the clean energy division of NTPC, achieved a subscription rate of 33%, primarily driven by retail investors who subscribed to 1.33 times the available shares.
The Non-Institutional Investors (NII) segment accounted for 16% of the shares available for subscription, whereas the qualified institutional buyers (QIBs) segment did not receive any bids on the initial day. The employee portion was subscribed 17%, while the shareholder portion was booked 57%.
The initial public offering, valued at ₹10,000 crore, comprises entirely of new equity shares, with no segment designated for an offer-for-sale (OFS). Investors have the opportunity to subscribe to this offering, which has established a price range of ₹102 to ₹108 per share, from November 19 to November 22. Out of the total proceeds from the IPO, which amount to ₹7,500 crore, a substantial portion will be allocated to the repayment or prepayment of some or all outstanding loans of its subsidiary, NTPC Renewable Energy Ltd (NREL), while a portion will also be reserved for general corporate purposes.
NTPC Green Energy is recognised as a central public sector enterprise with 'Maharatna' status, concentrating on renewable energy through solar and wind power projects across more than six states.
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The initial public offer of NTPC Green Energy IPO has been subscribed 86% on the second day of subscription today, at 14:15 IST, as per BSE data.
The initial share sale received bid for 51,21,54,294 shares against 59,31,67,575 shares on offer, according to BSE.
The portion for retail investors received 2.17 times subscription while the quota for non-institutional investors got subscribed 28%. The qualified institutional buyers (QIBs) part is booked 74%. The shareholder portion has been subscribed 91%, and the employee portion has been booked 35%.
"The company’s revenue from operations has grown at a CAGR of 46.82% from ₹ 910.42 Cr in FY 2022 to ₹1,962.60 Cr in FY 2024. The company is investing in hydrogen, green chemical and battery storage capabilities and solutions as well as associated technologies. NTPC GEL holds a vision of 60 GW RE capacity by 2032. We suggest ‘SUBSCRIBE’ to the issue with Long term Investment perspective," the brokerage said.
"Considering the TTM-Sept 24 EPS of ₹0.52 on a post-issue basis, company is set to list at a P/E of approximately ~208x with a market cap of ₹91,000 cr whereas its peer, Adani Green Energy Limited is trading at P/E ratio of approximately ~182x respectively.
We assign “Subscribe" rating to this IPO as company is promoted by NTPC Limited, which has extensive experience in executing large- scale projects, long term relationships with offtakers and suppliers and financial strength," the brokerage said.
The initial public offer of NTPC Green Energy IPO has been subscribed 85% on the second day of subscription today, at 13:18 IST, as per BSE data.
The initial share sale received bid for 50,19,59,406 shares against 59,31,67,575 shares on offer, according to BSE.
The portion for retail investors received 2.11 times subscription while the quota for non-institutional investors got subscribed 27%. The qualified institutional buyers (QIBs) part is booked 74%. The shareholder portion has been subscribed 88%, and the employee portion has been booked 33%.
There is huge potential for power demand in India as electricity requirements have risen at a CAGR of approximately 8.4% between FY21-24 and expects power demand to grow by 5.5-6.0% in the next five years which will be supported by infrastructure-linked capital expenditure.
“Backed by NTPC’s financial strength, NGEL is poised for growth with a 26,071 MW portfolio and an aggressive expansion plan. Its revenue has grown at a CAGR of 46.8%, reaching ₹1,963 crore in FY24, with strong EBITDA and PAT margins. NGEL's strategic focus on high-capacity utilization, low costs, and long-term PPAs ensures stable revenue streams, positioning it as a key player in India’s energy transition and net-zero goals. Hence, we recommend an “Subscribe" rating to this issue for the long-term gains," the brokerage said.
The initial public offer of NTPC Green Energy IPO has been subscribed 48% on the second day of subscription today, at 11:30 IST, as per BSE data.
The initial share sale received bid for 28,64,65,506 shares against 59,31,67,575 shares on offer, according to BSE.
The portion for retail investors received 1.95 times subscription while the quota for non-institutional investors got subscribed 25%. The qualified institutional buyers (QIBs) part is yet to be booked. The shareholder portion has been subscribed 82%, and the employee portion has been booked 30%.
The company's financial performance has improved significantly, with revenue increasing from Rs. 910 crores in FY22 to Rs. 1,963 crores in FY24. This represents a compound annual growth rate (CAGR) of 46.8%. Alongside this growth, margins and profitability have also improved, with profit after tax (PAT) growing at a CAGR of 90.8% during the same period. Additionally, the average capacity utilisation factor (CUF) for solar assets has increased from 19.2% to 23.9% between FY22 and FY24, resulting in a threefold increase in power generation.
The company is actively exploring growth in green hydrogen and battery storage. It is establishing a green hydrogen hub at Pudimadaka, Andhra Pradesh, and is finalizing partnerships for electrolyzer production. Additionally, NGEL plans to build a grid-scale battery storage facility to support solar and wind power integration, while also participating in grid-scale battery storage tenders for grid balancing. The company has leased 1,200 acres of land at Pudimadaka and has made a capital advance of ₹7 billion, although detailed capex plans are still under development.
“At the upper price band of ₹108, NGEL is valued at FY24 EV/EBITDA of 53.4x on post issue capital. The company will increase its operational capacity to approximately 19 GW by FY27 and 60 GW by 2032 from 3.3 GW as of Sep'24. The company has exponential growth potential in medium term over FY24 to FY27 period. We recommend to SUBSCRIBE to the issue for long term," the brokerage said.
The initial public offer of NTPC Green Energy IPO has been subscribed 38% on the second day of subscription today, at 10:06 IST, as per BSE data.
The initial share sale received bid for 22,82,08,116 shares against 59,31,67,575 shares on offer, according to BSE.
The portion for retail investors received 1.54 times subscription while the quota for non-institutional investors got subscribed 19%. The qualified institutional buyers (QIBs) part is yet to be booked. The shareholder portion has been subscribed 68%, and the employee portion has been booked 24%.
NTPC Green Energy IPO has reserved not less than 75% of the shares in the public issue for qualified institutional buyers (QIB), not more than 15% for non-institutional Institutional Investors (NII), and not more than 10% of the offer is reserved for retail investors. Employees have been reserved equity shares aggregating up to 20 crore, and a discount of ₹5 per equity share is being offered to eligible employees.
Tentatively, NTPC Green Energy IPO basis of allotment of shares will be finalised on Monday, November 25 and the company will initiate refunds on Tuesday, November 26 while the shares will be credited to the demat account of allottees on the same day following refund. NTPC Green Energy share price is likely to be listed on BSE and NSE on Wednesday, November 27.
“NTPC Green Energy has deep domain expertise of the management team focusing on new energy solutions like green hydrogen, green chemicals and storage with prudent growth and contributing towards fulfilling India’s net zero goals. We believe with a prudent business model and strong earnings growth with improved financials and return ratios, we recommend a Subscribe to the issue for the long term," the brokerage said.
As of September 30, 2024, the company engaged with 17 offtakers across a total of 41 solar projects and 11 wind projects. The term "offtakers" refers to entities with which the company has operational megawatts, whether contracted or awarded, including those with signed Power Purchase Agreements (PPAs) or Letters of Authorization (LoAs). Notably, all 9 of the offtakers from which the company generated revenue during the six-month period ending September 30, 2024, were government agencies and public utilities, with whom they maintain long-term PPAs averaging 25 years in duration.
NTPC Green Energy IPO GMP today is +0.80. This indicates NTPC Green Energy share price was trading at a premium of ₹0.80 in the grey market, according to investorgain.com.
Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of NTPC Green Energy share price is indicated at ₹108.8 apiece, which is 0.74% higher than the IPO price of ₹108.
According to the evaluation of the last 18 sessions of grey market activities, the present GMP of ₹0.80 is exhibiting a tendency towards a decline. The lowest GMP recorded is ₹0, while the highest is ₹25, as per the insights provided by investorgain experts.
'Grey market premium' indicates investors' readiness to pay more than the issue price.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.
