The IPO of NTPC Green Energy, a subsidiary of NTPC, has opened for subscription from today (Tuesday (November 19, 2024). Interested investors can bid for it till November 22, 2024. Before opening for subscription, the company has raised a total of ₹3,960 crore from anchor investors. The company is raising ₹10,000 crore through this IPO.

The price band for the IPO has been fixed at ₹ 102 - ₹ 108 per share. Investors can bid for a minimum of 138 shares in one lot and in multiples of 138 thereafter.

The company has issued 36,66,66,666 shares for anchor investors at a price of ₹ 108 per share. Out of these 36.6 crore shares, 14.53 crore shares have been allotted to 16 domestic mutual funds in 72 different schemes. The anchor book of NTPC Green Energy IPO includes big names like New World Fund, International Growth and Income Fund, Goldman Sachs, Morgan Stanley, New York State Teachers Retirement System, Government of Singapore, Monetary Authority of Singapore, T Rowe, Abu Dhabi Investment Authority, and BNP Paribas. Apart from this, there are many other names at the domestic level including LIC, ICICI Prudential Mutual Fund, Nippon Life India, Kotak AMC, Aditya Birla Sun Life AMC, DSP Mutual Fund, Whiteoak Capital, Canara Robeco MF. Should you subscribe? SBI Securities - Brokerage firm SBI Securities has advised to subscribe to the issue. The brokerage said, "At the upper price band of ₹ 108, the company's valuation is 53.4 times the post issue capital based on the enterprise value-EBITDA of the financial year 2024." SBI Securities said that the company will increase its operational capacity from 3.3 gigawatts by September 2024 to 6 gigawatts by the financial year 2025, 11 gigawatts by the financial year 2026 and 19 gigawatts by the financial year 2026. The company is likely to register rapid growth in the medium term. Its revenue, EBITDA and profit are expected to grow at a CAGR of 79.0%, 117.2% and 123.8%, respectively, during FY 24-27 to ₹11,250 crore, ₹9,563 crore and ₹1,980 crore, respectively. Reliance Industries - Brokerage firm Reliance Securities has recommended subscribing to the IPO for the long term. The brokerage said that NTPC Green Energy benefits from NTPC's financial strength and long-term relationships with off-takers and suppliers, which drive revenue growth, and strong credit ratings along with low cost of debt enable it to execute large-scale projects. The brokerage also said that NTPC Green Energy has the domain expertise of the management team, which focuses on new energy solutions such as green hydrogen, green chemicals and storage with strong growth and contribute to India's net zero goals. IPO details This IPO will be a completely fresh issue, which does not include any offer for sale (OFS). The face value of this IPO is ₹ 10 per equity share. 75% of this issue is reserved for institutional investors, 15% for non-institutional investors and 10% for retail investors. Eligible employees can bid for shares with a discount of Rs 5 per share, with shares worth Rs 200 crore allotted under the employee quota. Apart from this, shares worth Rs 1,000 crore will be set aside for existing NTPC shareholders under shareholder reservation.


Out of the total proceeds from the new issue, up to Rs 7,500 crore will be used to invest in the company's subsidiary NTPC Renewable Energy Limited (NREL) to fully or partially repay certain outstanding borrowings taken by NREL. Apart from this, funds will also be used for general corporate purposes.

IDBI Capital Markets & Securities, HDFC Bank, IIFL Securities and Nuvama Wealth Management are the book-running lead managers for the issue. This is the third largest IPO of 2024 after Hyundai Motor India's Rs 27,870 crore and Swiggy's Rs 11,300 crore. Sources had earlier told CNBC-TV18 that the NTPC management is aiming to unlock value through the listing of NTPC Green Energy.

About the Company
NTPC Green Energy, a wholly-owned subsidiary of NTPC, is the largest renewable energy public sector enterprise (excluding hydro energy) in terms of operational capacity as on September 24 and electricity generation by March 2024. The company's renewable energy portfolio comprises solar and wind power assets with presence in multiple locations across more than 6 states, which helps mitigate the risk of location specific generation variability.

As on September 2024, NTPC Green had an operational capacity of 3,220 MW solar projects and 100 MW wind projects across 6 states with an average power purchasing agreement (PPA) period of 25 years.

In addition, it has contracted and awarded projects of 13,576 MW and a capacity of 9,175 MW in the pipeline as on September 2024. NTPC aims to achieve 60 gigawatt (GW) of renewable energy (RE) capacity by FY32. Currently, it has an installed capacity of 3.5 GW and more than 28 GW of capacity is under development.