The NTPC Green Energy shares have fallen almost t 4% to an intraday low of Rs 120.50. This is in sync with the trend seen across the power stocks in the market today. Power stocks are under pressure and stocks that saw a big dent include Reliance Power (5%), Reliance Infra (4.8%), PTC India (3.7%), and JSW Energy (3.5%).
Is NTPC Green Energy a long-term buy?
That said many analysts are betting on the stock as a long-term buy given the opportunities in the renewable energy space as well as the company’s fundamentals.
NTPC Green Energy- JV push
The company formed a joint venture with Rajasthan Rajya Vidyut Utpadan Nigam (RVUNL). It has named the joint venture, NTPC Rajasthan Green Energy. It will be a subsidiary of NTPC Green Energy. In the freshly incorporated entity, NTPC Green Energy holds a stake of 74% while RVUNL has a 26% share, according to an exchange filing.
“NTPC Rajasthan Green Energy is a 74:26 joint venture of NGEL (NTPC Green Energy), a subsidiary of NTPC and RVUNL, a Government of Rajasthan Undertaking,” read the filing.
The objective of the newly formed entity is to develop, operate, and maintain renewable energy parks including UMREPP/RE projects comprising solar/wind/hybrid with or without storage up to 25 GW capacities in Rajasthan. Also, the NRGEL will develop green hydrogen/derivatives (green ammonia/green methanol etc.) with up to a 1 million ton capacity through a suitable model.
“NGEL has subscribed 74,000 (seventy-four thousand) equity shares (along with nominees) at the face value of Rs 10 each,” said the filing.
Meanwhile, the company incorporated another joint venture named NTPC UP Green Energy on January 05, according to a press release. The company holds a 51% stake in the entity while the other 49% is with Uttar Pradesh Rajya Vidyut Utpadan Nigam (UPRVUNL), an undertaking of the U.P. government. In this entity as well, the company’s objectives are similar to that of NRGEL.
NTPC Green Energy: Order boost
Five days ago, one of the company’s subsidiaries bagged an order from Uttar Pradesh Power Corporation (UPPCL). The subsidy secured a capacity of 1000 MW at an impressive tariff of Rs. 2.56/kWh. The tender was aimed at the “selection of solar power developers for setting up 2000 MW ISTS-connected solar PV power projects in India under tariff-based competitive bidding,
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