NTPC Green’s $1.2 billion IPO is fully subscribed by the final day in India’s bet on renewable energy

Investors bet on India's growing need for clean energy. The $1.2 billion NTPC Green Energy initial public offering was fully subscribed by Friday's closing day of the sale.

The 96% subscription rate was achieved by the institutional investors who received approximately three quarters of all 593.2 millions shares. The bids will close at 5 pm IST the same day.

As of 12:23 am IST, the portion reserved for retail investors had been oversubscribed 2.81 times after it was fully subscribed during Tuesday's first day of auction.

India is rushing to meet its clean-energy targets. It has increased investments in renewable energy, and expanded its capacity. According to Moody's Ratings it will need to spend $385 Billion by 2030 in order to reach its target after falling short of it in 2022.

Prashanth Tase, Senior Vice-President of Research at Mehta Equities, stated that investors are also optimistic about the sector. They are betting on it due to a large long-term demand as well as support from its parent company, state-owned NTPC.

Draft documents showed that the company intends to sell all shares at the IPO. Existing shareholders will not be diluted, according to the draft papers.

The price range was set at 102-108 rupees a share. This year, the IPO's total value is only behind Swiggy and Hyundai Motor India. The IPO is taking place at a time where Indian markets are cooling down from their previous frenzy, due to disappointing corporate earnings and a flight of foreign funds.

LSEG data revealed that 290 companies raised over $15 billion this year. This is roughly two times the amount raised for 2023.

The trading is expected to start on November 27 but has not yet been confirmed.

(source: Reuters)