12 Banks Compete for NTPC Green’s IPO Mandate

Investment banks compete intensely for NTPC Green's ₹10,000 crore IPO mandate

NTPC Green Energy Ltd, the renewables arm of state-owned power producer NTPC Ltd, is planning a Rs 10,000 crore initial public offering (IPO) in the coming months. At least 12 investment banks have offered to oversee the company's IPO, according to individuals familiar with the situation.

Earlier this month, the business submitted a request for proposal (RFP) to recruit merchant bankers for its potential IPO. The final bids for the privilege to oversee the IPO were submitted last Friday, according to sources. Domestic investment banks like SBI Capital, ICICI Securities, Axis Capital, DAM Capital, and Nuvama are among those bidding, according to sources. A few overseas investment banks have also competed for the IPO mandate, along with a few more domestic institutions. The winning bids will most likely be announced next week or later, according to sources.

As per the sources, the business expects to utilize the funds from the IPO to support ongoing and future solar energy, green hydrogen, and green ammonia capex initiatives. NTPC Green Energy was established in April 2022 as a wholly-owned subsidiary of NTPC. As of March 2023, the company's portfolio of renewable energy projects included solar, wind, hydro, and biomass, totaling 2,500 MW. As part of NTPC's goal of being a net-zero carbon emitter by 2050, the business plans to reach 10,000 MW by 2025 and 30,000 MW by 2032.

The NTPC Green Energy IPO would be the second-largest public offering by a state-owned firm, behind the Life Insurance Corporation of India (LIC)'s Rs 21,000 crore IPO in May 2022. The IPO of LIC, the country's largest insurer, was more than ten times oversubscribed and had a robust reaction from all types of investors. The NTPC Green Energy IPO is likely to draw comparable interest, given India's and the world's expanding demand for clean and renewable energy.

C Green Energy is also the second renewable energy business to go public in India, following the Indian Renewable Energy Development Agency (IREDA), which earned Rs 1,000 crore in an IPO in November 2023. IREDA, a non-banking financial firm, funds renewable energy projects in India. IREDA's IPO was 38.8 times subscribed and obtained a good listing on the stock markets.

NTPC Green Energy is projected to gain from India's favorable renewable energy legislation and regulatory environment, as well as global trends towards green and sustainable development. The firm is also anticipated to benefit from the skills and experience of its parent company, NTPC, India's largest power producer with a diverse portfolio of thermal, hydro, nuclear, and renewable energy sources. NTPC Green Energy is positioned to become a market leader in renewable energy in India, contributing to the country's energy security and climate goals.