Power Stocks Soar Amid Record Renewable Energy Growth in India for 2024

resr 5paisa Research Team

Last Updated: 15th January 2025 - 04:15 pm

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On January 15, power stocks experienced a notable surge, with Power Grid, NTPC, and Coal India emerging as the top Nifty 50 gainers, each climbing up to 4%. The rally was fueled by data from the Ministry of New and Renewable Energy, which highlighted that India achieved a record-breaking milestone in renewable energy generation in 2024.

Several other power sector stocks also participated in the uptrend, including Adani Green Energy, NHPC, Tata Power, Adani Power, JSW Energy, Torrent Power, SJVN, and CESC, which recorded gains ranging from 1% to 3%.

According to the ministry’s report, India’s renewable energy capacity more than doubled in 2024, rising by a remarkable 113% year-on-year to reach 30 gigawatts (GW), up from 13.75 GW in 2023.

Solar energy was the largest contributor, with an increase of 24.54 GW, reflecting a 33.47% year-on-year rise in cumulative installed capacity, reaching 97.86 GW by 2024. Wind energy capacity also grew, adding 3.42 GW, bringing the total to 48.16 GW—a 7.64% increase compared to 2023.

Bioenergy capacity saw a rise from 10.84 GW in December 2023 to 11.35 GW by December 2024. Small hydro projects experienced moderate growth, with installed capacity increasing from 4.99 GW to 5.10 GW over the same period.

The ministry emphasized the importance of these achievements in relation to India’s target of reaching 500 GW of renewable energy capacity by 2030. To stay on track, the country will need to add approximately 50 GW of renewable capacity annually over the next six years.

Market analysts at Elara Securities anticipate strong third-quarter earnings for power companies, driven by several key factors, including regulated equity growth from capacity expansions, new transmission line installations, improved hydroelectric output, increased short-term market volumes, and contributions from solar EPC and rooftop projects.

In a statement, the brokerage firm noted: “We maintain a favorable outlook on NTPC, supported by increased regulated equity from thermal capacity expansion; on CESC, due to its strategic focus on renewable energy; and on NLC, owing to its growing project portfolio.”

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