NTPC Green's $1.2 billion IPO fully subscribed on final day as India bets on renewable energy

NTPC Green Energy's $1.2 billion initial public offering, India's third-largest in 2024, was fully subscribed on the share sale's final day on Friday, as investors bet on the country's growing clean energy needs.

About three-quarters of the 593.2 million shares offered were set aside for institutional investors, and were 96 per cent subscribed. Bidding will end at 5 pm IST on the day.

The portion reserved for retail investors was oversubscribed by 2.81 times as of 12:23 am IST, after being fully subscribed on the first day of bidding on Tuesday.

India has been scrambling to meet its clean energy targets and has ramped up investments in renewable energy and expanded capacity. As per Moody's Ratings, it has to spend $385 billion by 2030 to meet its targets after it fell short in 2022.

Investors are also positive on the sector and are betting on its IPO due to hefty long-term demand and support from its stronger parent, state-owned power producer NTPC, said Prashanth Tapse, Senior Vice President of Research at Mehta Equities.

The company plans to sell all the shares in the IPO, with existing shareholders not diluting their stake, draft papers showed.

It set a price band of 102-108 rupees per share, with the total size of the IPO trailing only Hyundai Motor India and Swiggy this year. However, the IPO comes at a time when Indian markets have cooled off from their earlier frenzy due to underwhelming corporate earnings and an exodus of foreign funds.

Still, more than 290 companies have raised more than $15 billion so far this year, roughly twice the amount raised in all of 2023, LSEG data showed.

Trading is expected to begin on November 27 but is yet to be confirmed.