With India slowly transitioning to the sustainable and green energy economy, the hydroelectric power sector has turned out to be a crucial segment. Hydropower is reliable and renewable and it also contributes quite a lot to meet the provision of power needs of the country.
With 15 GW of new projects underway, the nation is set to boost its hydropower capabilities. By 2031-32, production is anticipated to grow from 42 GW to 67 GW, an increase of over 50%.
Due to the increase in demand of hydroelectricity in the country, the stocks of various leading hydro energy companies have now become the favourites of the investors who want to bet on this fast-growing segment in 2024.
This shift to a greener India gives us an opportunity to bring you some of the best hydro power stocks in India in 2024.
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Best hydro power stocks in India 2024
Here are some of the popular stocks in the sector. But it is advisable to do your own research about the hydro power share price, its financials, future prospects etc before investing.
1. NHPC Ltd
NHPC Ltd is a central public sector undertaking company majorly involved in the production of hydropower. It holds some of the biggest hydroelectric power stations in India and the aggregate electrical capacity of the company is above 6971 MW as of Q1 FY25. It has a decent number of projects on its development and has stated that it is keen on both solar and wind energy which provides a holistic perception of renewable energy.
Why invest?
- Strong backing from the government ensures financial stability.
- Consistent dividend payouts.
- Focus on expanding its renewable energy portfolio.
Financial outlook
NHPC has been delivering steady results along with adhering to the positive government policies which makes it a long-term investment option for people who want to invest in the renewable energy segment.
2. SJVN Ltd
Another public sector undertaking is SJVN Ltd. This company is mainly in the business of hydroelectric power generation. The company operates in hydro, wind and solar energy and has an installed capacity of approximately 1972MW in hydro power as of FY24. The target for SJVN is to reach 25,000 MW by 2030 and 50,000 MW by 2040 a major part of this will be contributed through hydro power.
Why invest?
- Strong project pipeline in both India and neighboring countries like Nepal and Bhutan.
- Reliable dividend history.
- Increasing focus on solar and wind energy for diversification.
Growth prospects
SJVN has been on the expansion of its operations in the international market. It has been concentrating on renewable energy sources that are the main drivers that make it a favorable investment hub for investors who are in search of growth in the long run.
3. Tata Power
Tata Power is developing two Pumped Hydro Storage projects in the Maharashtra state of India with an aggregate capacity of 2800 MW with the Government of Maharashtra. Such investment includes ₹13,000 crore project to set up 1800 MW plant at Shirawta- Pune and 1000 MW at Bhivpuri-Raigad.
These projects will help in reaching Maharashtra’s vision of a $1 trillion economy by 2028, generate 6000 employment opportunities and improve the stability of the grid thereby supporting cleaner renewable energy.
Why Invest?
- Strong financials and backing from the Tata Group.
- Commitment to achieving net-zero carbon emissions by 2045.
Future plans
The proposed plan of the company to develop up to 12GW of pumped storage capacity through captive reservoirs along with the existing and planned renewable power projects indicate the company’s focus on sustainable power.
Hence, with continuous investment and shifting from thermal power projects, Tata Power remains the best bet for long term investors in the renewable power segment.
4. NTPC Ltd
India’s biggest power generating company NTPC Ltd is now entering the renewable energy segment. It is focused on diversifying the portfolio for renewable energy sources and has set its sight on big hydroelectric projects. NTPC intends to generate 60,000 MW of renewable electricity by 2032.
Why invest?
- Market leader in power generation with strong government backing.
- Aggressive expansion into renewables, including hydropower.
- Consistent dividend payouts and strong financial performance.
Growth potential
NTPC’s strategic plan for renewable energy is clear and it already has a good standing in the power industry hence the low-risk high return strategy.
Also Read: Top solar energy stocks to watch
5. CESC Ltd
CESC Ltd is a part of RP-Sanjiv Goenka Group. The company is entering into the renewable segment of power generation aggressively in recent times. The Hydropower segment is another with which the company is currently directly involved. It owns and operates hydropower projects and is still actively looking for more in this segment.
Why invest?
- Diversified power generation portfolio.
- Stable financials and steady dividend payouts.
- Growing focus on renewable energy, which includes hydroelectric projects.
Outlook
CESC has a diversified business portfolio in the power generation sector and it is fully focused on sustainability which makes it a good investment destination in renewable energy.
Conclusion
Among all renewable resources, hydro power is one of the most efficient and significant energy resources needed for energy demand of India. The above companies have the following opportunities for investors who would wish to fund this sector in 2024.
The hydroelectric sector has relatively stable players like NTPC and NHPC, but new generation players like Tata Power and Adani Green Energy. However, because India is still in a process of pushing the adoption of clean energy, these hydropower stocks may be for the long term.
Interesting Read: What Is Green Energy Mutual Fund in India?
FAQs
- Why invest in hydropower stocks in 2024?
The future of energy in India is green. This is because India is heavily investing in renewable sources of power generation. Hydropower is renewable and has a reliability, which none of the other sources of energy can match. This source provides a substantial measure of the energy demand within the country. Hydropower is in high demand. This makes them a secure investment and a perfect choice for the long term investment.
- Which are the top hydropower stocks in India?
There are many companies listed in the stock exchanges of India who deal with renewable sources of energy. But among all, the top stocks in the power sector are NHPC Ltd, Satluj Jal Vikas Nigam Ltd, Tata Power Co Ltd, NTPC Ltd and CESC Ltd. These companies are in the renewable energy business. They are expanding their hydropower capacity. Both have their strengths including good financials and good dividends.
- Why is NHPC Ltd a good investment?
NHPC has created more than 7000 MW of hydel power generation capacity. It is diversifying into the solar and the wind energy sector. The steady dividend policy of the company is something which attracts investors. Due to reliable growth throughout the years and powerful financial history and a good support from the government, NHPC is among the most secure forms of investment that investors can think of.
- What are SJVN Ltd growth prospects?
SJVN envisages to develop a portfolio of 25,000 MW by the year 2040. It is expanding in India and the countries in the neighborhood. The company has a reasonable number of prospects in its current portfolio. It provides stable dividends and indicates a strong financial health. Investing in stable companies with a good track record all throughout the years is always a wise option to go for.
5: Why is Tata Power a leader in renewables?
Tata Power is a premium company and is one of the first movers in the energy sector in India. It has expanded operations in hydro, solar and wind energy generation. The hydropower capacity installed by the company is 500 MW which is very much involved in the green energy revolution in India. Therefore, it is possible to conclude that Tata Power can be considered as a rather prospective and secure object for long-term investment.
