Green Stocks Feb 17: Respite For Some Green Stocks

With the market continuing to be pulled by opposite forces, the small-cap and mid-cap indices remained broadly weak, especially all through the first half of the day. The second half did bring some respite as buyers emerged, and to no one’s surprise, some of the beaten-down green stocks recovered some lost ground. The recovery was led by the solar manufacturer Waaree Energies, whose strong order book and Q3 numbers finally seemed to have provided reassurance on further downsides to investors. It was the same story at the Gensol counter, which many believe has been beaten down too far. On the other hand, other erstwhile investor favorites like Shakti Pumps, and solar developers like NTPC Green, Acme Solar, and even the PSU SJVN continued to languish, drifting down to new lows or close to those.

Based on Q3 commentary and momentum on the ground, valuations finally seem reasonable for green stocks, and it will be events on the ground especially anticipation of future challenges, that remain to drag back an eventual recovery on stock prices as well. Outliers like Adani Green (still a high PE stock) or KPI Green (Definitely undervalued based on numbers) are clearly dancing to a different tune for now, and it will be interesting to see how these behave in case of a definite market upmove, that could be here as early as next week.