NLC India Plans To Go For IPO For Its Renewable Arm In FY26

NLC India Plans To Go For IPO For Its Renewable Arm In FY26

Power Generation PSU NLC India Limited (NLCIL) is gearing up to launch the Initial Public Offering (IPO) of its green energy arm in the next financial year. In its latest investor call, the top management revealed that the company plans to proceed with the IPO of its renewable energy division within a specific time period. NLC joins SJVN Limited which is also planning to hive off and list its non-Hydro assets under a separate subsidiary in due course.

“We formed a 100% owned subsidiary, NLC India Renewable Energy Limited (NIRL), for this purpose. We are in the process of transferring existing renewable assets to that company. The tax exemption for the bulk transfer from NLC India Limited to NIRL is currently being processed with the government. We are hopeful that by the second quarter of the next financial year or the third quarter, we will go for that IPO,” Prasanna Kumar, Chairman and Managing Director of the company stated.

The annual report of NLC India mentioned that NLC India Green Energy Limited (NIGEL) is another subsidiary positioned to lead the company’s renewable energy ventures. At the beginning of FY25, NIGEL had 2 GW of renewable energy assets under implementation.

“To further expand its renewable energy footprint, NIGEL plans to participate in competitive bidding and explore emerging opportunities within the green energy sector. This strategic expansion aims to reduce India’s reliance on conventional energy sources, diversify the energy generation mix, and decrease coal imports. Moreover, it will contribute to ensuring a consistent and reliable power supply across the country,” according to NLC India’s annual report.

NLC India, traditionally focused on expanding its thermal projects, has significantly ramped up its renewable initiatives. Many would say the firm surprised many by ‘overachieving’ on its green goals when compared to many other PSUs that have struggled to make headway. The company has around 1.4 GW of operational renewable energy capacity, making it the first Indian public sector enterprise to achieve 1 GW in renewables. Looking ahead, NLCIL plans to increase its total renewable capacity to 6 GW by 2030. The company also marked its 10th year in renewable energy generation.

Recently, NLCIL commenced work on several solar and wind projects, including 600 MW of renewable projects at Khavda. It has signed an agreement with Rajasthan Urja Vikas Nigam Limited for 2,000 MW of solar and wind projects and formed a joint venture with the Assam government to develop 1,000 MW of solar capacity. Additionally, NLCIL is developing a 50 MW solar park on reclaimed mined-out land, with a project cost of Rs 225 crore.

Power Sector PSUs in the Indian stock market 

Currently, several power-related PSUs have already ventured into the Indian stock exchange by issuing IPOs. NTPC, NLC India, Power Grid, and IREDA have already raised public funding. Now a number of them are also expanding the growth of their green subsidiaries for large funding. For example, NTPC recently announcedthe IPO of NTPC Green. Now with the likely inclusion of the green arm of NLC Indian, the green energy subsidiaries of PSUs will see an increased presence and competition. Several private-sector solar and renewable companies like Premier Energies, Waaree Energies, ACME Solar, Gensol, Insolation Energy and others have already ventured into the market and a number of them got good traction and valuations in the public market.