In its latest report titled “Charging up: Harnessing the benefits of a good cycle,” Macquarie has highlighted the promising outlook for India’s electric utilities and power lenders. With energy transition and security becoming critical priorities, the report notes that electric utilities in India stand to benefit significantly, backed by solid balance sheets that enable increased capital expenditures.
Macquarie sees a favorable environment for loan growth among power lenders, specifically Power Finance Corporation (PFC) and Rural Electrification Corporation (REC), which are positioned for strong returns and maintain healthy balance sheets. These companies are identified as clear plays in the current growth cycle due to their unique positioning in the ecosystem.
The firm has initiated coverage on PFC, REC, Power Grid Corporation of India Limited (PGCIL), and NTPC as major beneficiaries of these tailwinds. Macquarie’s target prices are set as follows:
- PFC: Rs 630
- REC: Rs 660
- NTPC: Rs 475
- Power Grid Corporation of India (PWGR): Rs 380
With these target prices, Macquarie underscores the significant growth potential for these companies as they continue to support India’s energy infrastructure transition and security objectives.
