The power sector is a thriving sector in India. There are many companies that are launching new projects to make power cheaper for everyone in the country. If you are interested in investing in the sector, you might want to know what the best stocks to buy are. Here are some of the companies you might want to consider.
Tata Power
Tata Power is India’s largest integrated power company. It provides convenience as well as clean energy to consumers. The company has over 100 years of presence in the power sector. In 1915, the company established its first hydroelectric power station in India.
Tata Power has over 12,000 MW of generation capacity. It also has a significant portfolio of renewable energy. As part of its clean energy initiative, the company aims to boost clean energy generation to at least 40 percent in the next five years.
Tata Power has a large portfolio of long-term power purchase agreements. Moreover, the company is a strong EPC player. This explains why its total revenue grew at an average rate of 9.2% over the past five years.
The company is a pioneer in technology adoption in the utility industry. For example, it was the first to implement a pad mount substation. It also designed the world’s first energy-as-a-service platform.
Tata Power is India’s leading rooftop solar provider. The company has over a third of its portfolio devoted to clean energy. In addition, it operates a large number of coal-fired and hydroelectric power plants.
Tata Power has a strong focus on health and safety. Besides, it has a commitment to the environment and community.
Suzlon energy
Suzlon Energy has the potential to become the market leader in Indian wind power in the coming years. It has an integrated value chain and offers total solutions from wind turbines to post-commissioning operations and maintenance. But it has also got a very difficult battle on its hands.
Suzlon Energy is a diversified company with manufacturing facilities in four countries and global reach. The company has an established R&D effort, which leverages the knowledge pools in allied fields.
The company is a top five wind turbine manufacturer in the world. They manufacture components and systems, including turbines, gearboxes, and wind turbine generators (WTGs). Their turbines emphasize power quality, reliability, and safety. Moreover, they are designed to increase efficiency and reduce stress.
The company has a global footprint and is active in 32 countries, including the U.S., Brazil, Chile, South Korea, and Spain. With a combined manufacturing capacity of 2,700 MW, Suzlon is one of the largest manufacturers of wind power equipment in the world. In addition, the company has facilities in India, China, Belgium, and the Netherlands.
However, the company’s financial strength has been compromised. Since 2012, its topline has dropped 7 times. As a result, the cumulative loss of the company has exceeded Rs19,800 crore. While the debt has been reduced, the company faces a tough battle for market share in the coming years.
NTPC Limited
NTPC Limited is an Indian public sector undertaking (PSU) company. Founded in 1975 as Nathpa Jhakri Power Corporation, it now operates in several countries in Asia and Africa. Its business includes the generation and sale of electricity. In addition to generating power from conventional sources, NTPC also explores oil and gas as well as coal mining.
NTPC’s main business is the generation of power from coal-based thermal power plants. However, the company is also involved in coal mining, oil exploration, power trading, and rural electrification. Other activities include consultancy, equipment manufacturing, training, and supervision services. The company has 25 international clients.
NTPC is a global power player and ranks among the top five power utilities worldwide. It has a presence in several parts of the world, including Indonesia, Sri Lanka, and Bangladesh. NTPC has more than 1,200 generating stations in seven states of India.
The company aims to reach 60GW of incremental RES capacity by FY32. Its other business segments include consultancy, oil and gas exploration, power trading, equipment manufacturing, and project management.
The company’s financial position is strong. As of March 31, 2018, the company’s standalone P/BV was at 1x, while its consolidated P/BV was at 7.2x.
Adani Power Ltd
If you are planning to invest in the power sector, Adani Power Ltd is a great share to buy. It is the largest private thermal power producer in India, operating over 9,240 MW of thermal power capacity. Moreover, it has a solar power project of 40 MW in Gujarat. The company has also set up several projects across seven states.
The company’s stock is listed on leading Indian stock exchanges. However, shareholders have to purchase through registered brokers. Fortunately, the company has shown good results this quarter.
In the last five years, the company has shown solid revenue and profit growth. At the same time, the company has been able to generate positive net cash flow. This has helped the company grow its dividend yield.
As a result, the share price of the company is on the lower side. Still, this stock offers the potential to go up in the future.
The company has also forged a strategic path to becoming water neutral by 2035. Moreover, the company is working on various energy-efficiency measures. For instance, it is implementing rainwater harvesting in its hinterland plants. Also, the company has started integrating transmission line projects across different entities of the Adani Group.
Reliance Power Ltd
Reliance Power Limited is a powerhouse with a massive portfolio of power generation assets. It also operates transmission lines and retail operations.
The company is one of the oldest electricity generators in India. It operates over 1,200 generating stations in seven states. They generate 50,000 MW of electricity annually.
Reliance Power Limited is a subsidiary of the Reliance Group. It was previously called Reliance Energy Generation Ltd. It is the largest privately owned powerhouse in the country.
Aside from the big three of coal, gas, and oil, they use biomass and wind energy to keep the lights on. In fact, the company was able to start a 3740 MW Natural Gas based Combined Cycle Power Plant in Dadri.
They are also planning a number of major power projects. One such project is the Sasan Ultra Mega Power Project, which is part of an Indian government initiative to help ease the country’s growing power deficit.
One of the company’s other notable achievements is the formation of the Clean Development Mechanism. Its executive board is responsible for issuing Certified Emission Reduction (CER) certificates.
Aside from the usual suspects of coal and gas, they have also been known to use wind and solar energies. For instance, they are installing wind turbines at various locations.
Borosil Renewables Ltd
Borosil Renewables Ltd is an India-based company that manufactures solar glass and other products for the solar industry. Its patterned and volumetric glassware is sold to over 50 countries.
The company started its solar glass manufacturing journey in 2010 in Bharuch, Gujarat. In the years ahead, Borosil invested in increasing its manufacturing capacity. Now, it has a production capacity of 450 tons per day.
Solar Glass is used in solar panels and flat plate collectors. There are different types of glasses manufactured by the company, such as antimony-free, low iron textured, and matte finish. Some of these glasses are used in greenhouses, flat plate collectors, and photovoltaic panels.
India’s total solar capacity is expected to increase by 342 GW by FY22-FY30. As a result, the country will require 20 trillion INR in RES capacity over the next decade.
However, Indian solar manufacturers face significant competition from China and Malaysia. These manufacturers import most of their components and raw materials. Therefore, the competitiveness of these companies is poor.
To avoid this, the government of India introduced an anti-dumping duty on Chinese solar products. This duty is to be implemented for a period of five years. Consequently, the average ex-factory price of tempered solar glass declined by 14%.
Torrent Power Ltd
Torrent Power Ltd is one of the fastest-growing powerhouses in India. Its renewable energy capacity is set to double in two years. Torrent Power offers end-to-end clean energy solutions. The company has experience in implementing large power projects. Moreover, Torrent has a unique mix of coal and gas-based plants. Besides, Torrent has a proven track record of delivering enhanced value.
Torrent Power Ltd is an integrated power utility. With a presence in transmission, generation, and distribution, the company has become one of the largest and most efficient utilities in the country.
Torrent Power operates in 13 states in India. Some of its key operational assets include a power generation facility of 3879 MW, which is capable of supplying over 3.65 million customers annually. Furthermore, Torrent has a diverse portfolio of products and services, including solar power plants and cables.
Torrent is engaged in a variety of power generation projects, such as the SUGEN Mega Power Project, a 220 kV transmission project in Gujarat, a 1015 MW wind power project in Uttar Pradesh, and a 136.8 MW wind power project in Gujarat. Additionally, Torrent has acquired two of India’s oldest utility companies. These acquisitions have helped Torrent establish itself as a major power player.