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India is one of the world’s leading markets for renewable energy, with a rapidly growing sector. The Indian government has set ambitious targets for renewable energy deployment, and the private sector is investing heavily in the sector. This is creating a number of investment opportunities in Indian renewable energy stocks. The government has a goal to achieve 500 gigawatts (GW) of renewable energy capacity by 2030.
Here are India’s top 5 renewable energy stocks for sustainable profits:
#1 Larsen & Toubro (L&T)
Larsen & Toubro (L&T), a prominent Indian engineering and construction company, holds a strong presence in the renewable energy field, boasting a portfolio of over 10 gigawatts (GW) in renewable energy projects. L&T is a leading player in both the Indian solar and wind energy markets.
L&T’s financial strength is a significant advantage, As a diversified company with a sturdy financial foundation, it possesses the necessary financial flexibility to make substantial investments in the renewable energy sector, even in the face of economic downturns in other sectors. This financial stability ensures that L&T can continue to drive progress and innovation in India’s renewable energy landscape.
The company has allocated a capital investment of US$ 2.5 billion (approximately Rs 207 billion) for its green energy initiatives over the upcoming three to four years. This financial commitment will facilitate the expansion of its production capacity, foster the development of cutting-edge technologies, and enable the company to enter new markets.
From 2019 to 2023, the company has achieved notable growth, with a 5-year compounded annual growth rate (CAGR) of 9% for sales and 8% for net profit. This performance reflects strong returns, with an average Return on Equity (RoE) of over 12% and an average Return on Capital Employed (RoCE) of 13.3%.
#2 Adani Green Energy
Adani Green Energy is India’s largest renewable energy company. The company has a portfolio of over 20 GW of renewable energy capacity, and it is targeting to reach 45 GW of capacity by 2030. Adani Green Energy is also one of the leading players in the Indian solar energy market.
Adani Green experienced remarkable growth, with its operational capacity expanding by more than 40% compared to the previous year. During this period, the company successfully launched several significant projects, including a 2,140-megawatt solar-wind hybrid power plant, a 325-megawatt wind plant, and a 212-megawatt solar power plant in Rajasthan and Madhya Pradesh.
Looking ahead, Adani Green is gearing up for substantial investment, with plans to allocate US$ 20 billion (equivalent to Rs 1.63 trillion) over the next decade.
#3 Indian Oil Corp (IOC)
Indian Oil Corporation (IOC) holds the distinction of being India’s largest oil and gas company. The company is also one of the leading players in the Indian renewable energy sector. The company has established a new subsidiary focused on clean and sustainable low-carbon energy. This move is part of their ambitious plan to achieve net-zero emissions from their operations by 2046.
In line with their sustainability goals, the company is aiming for significant milestones. By 2050, they are targeting a renewable energy capacity of 200 gigawatts (GW) and the production of 7 million tonnes of biofuels derived from biomass, along with generating 9 million tonnes of biogas from decomposed plant and animal waste.
Recognizing that the refinery sector is a significant contributor to global carbon emissions, accounting for approximately 3%, many oil and gas companies in the country are venturing into green hydrogen production.
This particular company, which is one of the leading hydrogen producers through traditional carbon-intensive methods, is committed to converting 50% of its hydrogen production to green hydrogen by 2030. To achieve this, they are constructing green hydrogen plants at their Mathura and Panipat refineries. Furthermore, they have plans to establish a green hydrogen manufacturing unit in Kochi and have formed strategic partnerships with ReNew Power and Larsen and Toubro to facilitate green hydrogen production.
#4 Reliance Industries
Reliance Industries is India’s largest private sector company, and it is also one of the leading players in the renewable energy sector. Reliance is on a mission to establish a vast renewable energy network in India. Their ambitious goal is to achieve net-zero carbon emissions by 2035, with plans to develop 100 gigawatts (GW) of renewable energy capacity by 2030. They are currently constructing the world’s largest integrated renewable energy manufacturing facilities in Jamnagar, backed by an investment of over US$ 10 billion. This ecosystem will encompass hydrogen, wind, solar, fuel cells, and batteries to provide reliable, clean, and affordable energy solutions. Of this investment, approximately Rs 600 billion will be used for state-of-the-art manufacturing facilities, while the remaining Rs 150 billion will support value-chain partnerships and future technologies. To ensure success, Reliance is partnering with industry leaders, investing approximately US$ 1.2 billion in collaborations with REC, NexWafe, Sterling and Wilson, Stiesal, and Ambri to access expertise and technology for their fully integrated renewable energy initiative.
#5 National Thermal Power Corporation (NTPC)
NTPC holds the distinction of being India’s largest power generation company, and it has a significant presence in the renewable energy sector. Through its subsidiary, NTPC Renewable Energy, the company undertakes substantial solar, wind, and hybrid projects across the nation. NTPC Renewable Energy specializes in the development of large-scale renewable energy parks and projects in various states, in alignment with the government’s UMREPP (Ultra Mega Renewable Energy Power Park) initiative.
NTPC is also at the forefront of pioneering green hydrogen initiatives in India. They are in the process of establishing the country’s inaugural green hydrogen fuelling station in Ladakh. Furthermore, NTPC is setting up India’s first green hydrogen energy storage facility at its Simhadri facility and is actively engaged in a hydrogen pilot project at its Vindhyanchal unit.
What is the Indian government’s target for renewable energy capacity by 2030?
The Indian government aims to achieve 450 gigawatts (GW) of renewable energy capacity by 2030, signaling a strong commitment to transitioning towards cleaner and more sustainable energy sources.
Which is the top renewable energy stock in India, and why?
Larsen & Toubro (L&T) is identified as a top renewable energy stock in India. It holds a significant presence in the renewable energy sector with a portfolio of over 10 gigawatts (GW) in projects. L&T’s financial stability, diversified business, and substantial investments in green energy initiatives make it a leading player in the Indian solar and wind energy markets.
What is Adani Green Energy’s target for renewable energy capacity, and how has it performed in recent years?
Adani Green Energy, India’s largest renewable energy company, is targeting 45 gigawatts (GW) of capacity by 2030. In the fiscal year 2023, the company experienced remarkable growth, with operational capacity expanding by more than 40%. Adani Green Energy’s commitment to substantial investment and its impressive financial performance contribute to its status as a top renewable energy stock.
