Tue Nov 19 09:48:29 UTC 2024: ## NTPC Green Energy IPO Opens, Receives Mixed Signals on Day 1

**Mumbai, November 19, 2024** – The much-anticipated initial public offering (IPO) of NTPC Green Energy Ltd (NGEL), a wholly-owned subsidiary of NTPC Ltd, opened for subscription today at a price band of ₹102-₹108 per share. The three-day IPO aims to raise ₹10,000 crore (approximately $1.2 billion USD), with the issue closing on November 22nd. The company plans to list on stock exchanges on November 27th.

NGEL, India’s largest renewable energy public sector enterprise (excluding hydropower), boasts an operational capacity of 3.3 GW and a robust pipeline of contracted and awarded projects totaling 13.6 GW. The company aims to expand its operational renewable capacity to 19 GW by FY27, a crucial component of NTPC Ltd’s broader strategy to reach 60 GW of renewable energy capacity by 2032.

The IPO received a mixed response on its first day. While NGEL successfully raised ₹3,960 crore through its anchor book on Monday, with LIC as the largest investor (₹500 crore), subscription levels remained low throughout the morning, reaching only 19% by midday. Analyst opinions are divided, with some citing long-term growth potential and strong parentage as reasons to subscribe, while others express concerns about overvaluation compared to peers, particularly regarding the price-to-earnings ratio and capacity utilization factor.

NTPC, the parent company, recently paid an interim dividend of ₹2,424 crore to its shareholders, highlighting its strong financial position. NGEL intends to use ₹7,500 crore of the IPO proceeds to repay debt, with the remaining funds allocated for general corporate purposes. The company’s geographical diversification across key Indian states and exploration of advanced technologies like green hydrogen add to its long-term appeal, though risks remain regarding reliance on government utilities and potential execution challenges for future projects. The IPO allocation is 75% for Qualified Institutional Buyers, 15% for Non-Institutional Investors, and 10% for Retail Investors. The minimum bid lot size is 138 shares.

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