Best Solar Energy Stocks in October 2024 Based on 5Y CAGR

As of 2023, India ranked 4th in terms of installed renewable energy capacity, wind power capacity, and solar power capacity. The installed renewable power generation capacity has increased at a fast pace over the past few years, posting a CAGR of 15.4% between FY16 and FY23. India’s capacity for renewable energy in FY23 is 125.15 GW. By the end of December 2023, solar energy made up 40.1% of all installed renewable capacity and 16.9% of all installed power capacity. In this article, we will explore the best solar energy stocks in October 2024, based on 5Y CAGR.

Best Solar Energy Stocks in October 2024 – Based on 5Y CAGR

Note: The stocks mentioned above have been selected from the Renewable Solar Energy Sector Stocks  and sorted based on 5Y CAGR as of September 25, 2024

Overview of 5 Solar Energy Stocks

• Adani Green Energy Limited: Adani Green Energy Limited is a holding company of several subsidiaries that operate renewable power generation businesses within the group. It is primarily involved in renewable power generation and other ancillary activities. During Q1 FY25, Adani Green operationalised a 250 MW wind power capacity at Khavda. This capacity addition boosts Khavda’s operational capacity to 2.25 gigawatts, combining solar and wind sources.

Key Metrics:

• Return on Equity (ROE): 17.1%
• Return on Capital Employed (ROCE): 9.81%
• Orient Green Power Company Limited: Orient Green Power Company Limited is an Independent Producer of Renewable Power, it is engaged in developing, owning, and operating a diversified portfolio of Wind Energy Power Plants.  The company is planning to expand its capacity by venturing into solar and hybrid models (comprising wind & solar). As of March 31, 2024, the company’s aggregate installed capacity was 402.3 Mega Watt (MW).

Key Metrics:

• ROE: 4.44%
• ROCE: 6.97%
• SJVN  Ltd: SJVN generates Electricity and provides consultancy for hydropower projects. In August 2024, it commissioned a 90 MW Omkareshwar Floating Solar Project in Madhya Pradesh, which has the capacity to generate 196 million units of energy per annum. 

Key Metrics:

• ROE: 5.90%
• ROCE: 4.99%
• NHPC Ltd: NHPC is the Government of India’s flagship hydroelectric generation company. The company is primarily involved in generating and selling bulk power to various Power Utilities. Lately, the company received an LOI (Letter of Intent) for setting up 200 MW Grid Connected Solar Photovoltaic Power Projects located in GSEC’s RE Park (Stage-III) at Khavda, Gujarat.

Key Metrics:

• ROE: 9.61%
• ROCE: 7.67%
• KPI Green Energy Ltd: KPI Green Energy Ltd develops, builds, owns, manages, and maintains renewable power facilities as an Independent Power Producer (IPP) and a service provider to Captive Power Producers (CPPs) under the ‘Solarism’ brand. KPI Green Energy is helping other companies significantly reduce their electricity expenses through captive generation, leveraging the cost arbitrage between captive solar and hybrid plants and power supplied from DISCOMs.

Key Metrics:

• ROE: 29.6%
• ROCE: 21.6%

Steps Taken by Government to Promote Solar Energy

The Union Government has taken various steps for the promotion of solar energy in the country. These mainly include:

• Permitting Foreign Direct Investment (FDI) up to 100% under the automatic route,
• Waiver of Inter State Transmission System (ISTS) charges for inter-state sale of solar and wind power for projects to be commissioned by 30th June 2025,
• Declaration of trajectory for Renewable Purchase Obligation (RPO) up to the year 2029-30,

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.