India’s clean energy sector has seen a sharp decline in initial public offerings (IPOs) this year, with only two companies going public in transition industries so far. According to Bloomberg, these companies include Solarium Green Energy, a solar module manufacturer, and Maxvolt Energy Industries, a battery maker. Together, their total valuation stands at just $18 million. In comparison, 2024 saw 14 IPOs in transition industries, with over $2.3 billion raised in the second half of that year alone.
The outlook for IPOs in these sectors remains uncertain. Sources quoted by Bloomberg suggest that bankers are advising lower valuations—up to 30% lower than what company executives are seeking. Edward Lees, co-manager of BNP Paribas’ Emerging Markets Environmental Solutions fund, explained that growth is slowing, and investors are no longer willing to pay a “green premium.” He also noted that investors are now placing more focus on the profitability of these companies.
In addition to declining valuations, the Indian market is facing other challenges that are hindering IPO activity. One major issue is the inability of alternative energy developers to secure long-term agreements with buyers. According to the Institute for Energy Economics and Financial Analysis, a growing number of wind and solar projects are struggling to secure offtake agreements with regional grid operators. This has led to delays, with 35 gigawatts of new projects waiting for such agreements due to bureaucratic hurdles and expectations of falling wind and solar power prices.
Despite these challenges, the future for clean energy in India remains positive. BloombergNEF predicts that this year’s new installations will break records, signaling continued growth in the sector.
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