NTPC Green Energy IPO: Can you buy NTPC shares now to be eligible for shareholder quota?

Last update:November 15, 2024, 1:54 p.m. IST

NTPC Green Energy IPO: According to the RHP, 10% of the Rs 10,000 crore IPO will be reserved for NTPC shareholders, thereby increasing their chances of allotment of the IPO.

NTPC Green Energy’s IPO will launch on November 19 and close on November 22.

With NTPC Green Energy’s IPO expected to open for public subscription on Tuesday, shareholders of its parent company NTPC Ltd will enjoy a greater advantage in the much-anticipated offering as they have a 10 percent. According to the Red Herring Prospectus (RHP), Rs 1,000 crore of the Rs 10,000 crore IPO will be reserved for NTPC shareholders and any investor holding even one share of NTPC will be eligible for apply within the shareholder quota, thereby increasing the chances of success. IPO Grant.

The IPO will be launched on November 19 and concluded on November 22, according to the RHP filed by NTPC Green Energy Ltd (NGEL), an umbrella company for state-owned power giant NTPC’s green business initiatives.

NTPC Green Energy IPO Shareholder Quota: Deadline

According to the RHP, “shares of face value of Rs 10 each will be allotted to eligible shareholders on a proportionate basis, such reserved share not exceeding 10 per cent of the total issue size.”

Under this, investors holding NTPC shares in their demat account as on the date of filing of the RHP – November 13 – will be able to apply for the IPO of NTPC Green Energy under the 10% shareholder quota. .

Shares of NTPC Ltd closed at Rs 372.8 apiece on the BSE on Thursday, down 2.19 per cent from the previous close.

NTPC Green Energy IPO: Can you buy NTPC shares now for shareholder quota?

No, the deadline was November 13. So, purchasing NTPC shares now will not make any investor eligible for the NTPC Green Energy IPO shareholder quota.

According to a market watcher: “If you know someone who currently owns NTPC shares, you can ask them to apply for the IPO on your behalf. This is now the only solution for those who do not hold shares.”

Indian stock markets are closed for three days: Friday (Guru Nanak Jayanti), Saturday and Sunday. So, Monday is the only trading day remaining before the IPO opens on Tuesday.

NTPC Green Energy IPO: Why are investors so interested?

After the recent bumper listings of two green energy companies – Premiere Energies and Waaree Energies, investors now find another opportunity to invest in the IPO of a green energy company, especially when it It is a subsidiary of a public electricity giant in India. However, shares of Premiere Energies and Waaree Energies have faced significant selling pressure in recent days.

Likewise, the gray market premium of NTPC Green Energy IPO shows moderate listing gains for investors. In fact, it is GMP is falling over the last seven days and fell from Rs 25 (or 23.14 percent) on November 9 to just Rs 2 (or 1.85 percent) on Friday, November 15.

GMP is based on market sentiments and keeps changing. The “gray market premium” indicates that investors are willing to pay more than the issue price.

The price band for the IPO has been fixed in the range of Rs 102 to 108 per share.

NTPC Green Energy IPO: Should You Apply? Analyst Recommendations

“We analyze NGEL’s business, review its valuation metrics and assess key concerns. The company has 3.2 GW of operational capacity, 12 GW of renewable energy (RE) projects under construction and a future development pipeline of 11 GW. NGEL is looking to not only set up utility-scale renewable energy projects but also tie up with corporates and PSUs to meet their captive renewable energy needs. We expect the return ratios of captive projects to be higher than those of large-scale projects,” ICICI Securities said in a note last month.

NTPC is targeting 60 gigawatts (GW) of renewable energy (RE) capacity by FY32.

“The IPO comes at a time when NTPC, a large thermal power company, is looking for other energy avenues to diversify and increase its revenues,” said Kranthi Bathini, director of equity strategy at WealthMills Securities, according to Reuters.

Given the fact that green energy will remain the center of attention in the near future, investors will definitely want a piece of this pie, Bathini added.

NTPC Green Energy IPO: more details

The IPO is entirely a fresh issue of up to Rs 10,000 crore without any element of an offer for sale. A discount of Rs 5 per equity share is offered to eligible employees who bid in the employee reservation portion.

The proceeds from its fresh issue will be used to the tune of Rs 7,500 crore to invest in its wholly owned subsidiary, NTPC Renewable Energy Limited (NREL) for repayment/prepayment, in whole or in part, of certain outstanding borrowings obtained by NREL and general corporate purposes.

NTPC Green Energy is the largest public sector renewable energy company (excluding hydropower) in terms of operating capacity as of September 30, 2024 and power generation in FY 2024, according to a CRISIL report of November 2024 .

Its renewable energy portfolio includes both solar and wind power assets, spanning multiple locations in more than six states, helping to mitigate the risk of location-specific generation variability. Its operational capacity was 3,220 MW of solar projects and 100 MW of wind projects in six (6) states as of September 30, 2024.

As of September 30, 2024, its portfolio consisted of 16,896 MW including 3,320 MW of operating projects and 13,576 MW of contracted and awarded projects. Its pipeline capacity and portfolio consisted of 26,071 MW. It had 17 buyers spread across 41 solar projects and 11 wind projects.

NTPC Green Energy’s operating revenue grew at a CAGR of 46.82%, from Rs 910.42 crore in FY2022 (on a specific basis) to Rs 1,962.60 crore in financial year 2024 (on a restated basis).

Its operating EBITDA grew at a CAGR of 48.23%, from Rs 794.89 crore in FY2022 (on a specific basis) to Rs 1,746.47 crore in FY2024 (on a specific basis). a retired base). Its profit after tax grew at a CAGR of 90.75 per cent from Rs 94.74 crore in FY 2022 (on a special basis) to Rs 344.72 crore in FY 2024 ( on a restated basis).