NTPC To Raise Funds via IPO For Green Energy Division
In line with sources, NTPC intends to raise funds for its green energy unit NTPC Green Energy Ltd (NGEL) through an initial public offering (IPO) this fiscal year, after Malaysia's Petroliam Nasional Berhad (Petronas) withdrew its offer for a 20% stake in the unit.
"The IPO will be done on a book building basis," one of the people said.
According to people familiar with the situation, Petronas beat out REC Ltd and Indraprastha Gas Ltd in a bidding war last month.
"There were further negotiations to increase the value after receiving the final bids, but the (highest) bidder retracted it," the person said.
According to the person, NTPC intends to monetise assets worth approximately 6,000 crore in FY24. The plan includes an IPO for NGEL.
The Cabinet Committee on Economic Affairs (CCEA) approved increasing NTPC's investment in NGEL above the prescribed limit of 5,000 crore for a maharatna company in its subsidiary on March 17.
However, the person stated that NTPC will continue to seek strategic investors for NGEL in the future.
Approximately 15 NTPC renewable energy assets were transferred to NGEL near the end of 2022-23. The ambitious clean energy programmes of India's largest power producer will be driven by NGEL. To complete the projects, the company will form subsidiaries and joint ventures.
NTPC intends to have 60 GW of standalone renewable energy capacity and 130 GW of consolidated renewable energy capacity by 2032. In addition, the company is working on nuclear energy, green hydrogen, e-mobility, and waste-to-wealth projects. NTPC previously stated that 40 GW of the 60 GW would be obtained through tariff-based competitive bidding, which would include bundling for round-the-clock power.
India has committed to reducing its GDP emissions intensity by 45% by 2030, as well as achieving approximately 50% cumulative electric power installed capacity from non-fossil fuel-based energy resources by the same date. It also intends to have 500 GW of installed non-fossil fuel capacity by 2030. NTPC contributes nearly 24% of total electricity produced in India, with a share of 17% of installed capacity.