The joint venture between Oil and Natural Gas Corporation (ONGC) and NTPC Green, ONGC NTPC Green Pvt Ltd (ONGPL), is set to acquire Ayana Renewable Power for $700-750 million.
This acquisition represents a major move toward expanding India’s renewable energy sector and underscores the country’s commitment to sustainable development.
Background of the Acquisition
ONGPL has nearly concluded negotiations to acquire 100% of Ayana Renewable Power, which boasts a portfolio of 4.6 GW in operation and under-construction, renewable energy assets, including solar, wind, and storage projects. Currently, Ayana operates 1.6 GW and is expected to add another 2.5 GW by the end of the next fiscal year.
The deal will see Ayana’s existing shareholders—National Investment and Infrastructure Fund (NIIF), British International Investment (BII), and EverSource Capital—exit by selling their stakes. The enterprise value of Ayana is pegged at $1.7-1.8 billion, a testament to the company’s importance in India’s growing renewable energy market.
Strategic Importance for ONGC and NTPC
This acquisition marks a pivotal step for ONGC, a state-run oil and gas giant, as it diversifies into green energy. ONGC, having spent over two decades acquiring oil and gas assets globally, has partnered with NTPC Green to mitigate risks and broaden its portfolio. With an ambitious target of achieving a 10 GW renewable energy portfolio by 2030, this acquisition is key to ONGC’s green energy strategy.
NTPC Green, a subsidiary of NTPC Ltd., India’s largest power utility, has been working to expand its renewable energy capacity. The public listing of NTPC Green’s shares has been positively received, boosting investor confidence. This acquisition strengthens NTPC Green’s position and accelerates its growth in the renewable energy market.
Boosting India’s Renewable Energy Sector
The ONGC-NTPC Green acquisition plays a critical role in advancing India’s renewable energy capacity. India is committed to scaling up its renewable energy output as part of its climate goals under the Paris Agreement. The deal will contribute to this mission by supporting the growth of green energy in India.
Ayana Renewable’s strong portfolio of solar and wind projects makes it an attractive acquisition. The transaction will also provide an exit for private equity investors, at a time when many renewable energy deals in India are struggling to close. This deal could set a precedent for future renewable energy transactions, especially as global investors focus on the green energy transition.
Financial Implications and Future Prospects
With an investment of $750 million, ONGC and NTPC Green are solidifying their positions in India’s renewable energy market. The acquisition demonstrates the growing importance of public-private partnerships in meeting large-scale renewable energy targets. It is expected to help the joint venture mitigate risks, benefiting from NTPC’s power generation expertise and ONGC’s infrastructure and financial capacity.
Ayana’s financial performance, with a reported profit of ₹46 crore on operating income of ₹856 crore for FY 2023-24, highlights its viability and future growth potential. India’s renewable energy sector continues to attract both domestic and international investments, offering long-term growth opportunities.
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Conclusion: A Step Towards Sustainable Energy
The $750 million acquisition of Ayana Renewable Power by ONGC NTPC Green Pvt Ltd is more than just a corporate deal; it is a significant leap in India’s journey toward sustainable energy. As ONGC and NTPC Green expand their renewable energy portfolios, the acquisition positions them to meet India’s renewable energy targets and contribute to a cleaner, greener future.
This deal also highlights the increasing role of public sector companies in shaping India’s green energy landscape, underscoring the potential of collaboration between government-owned entities and private investors. With the global shift toward renewable energy, India’s commitment to clean energy, demonstrated by this acquisition, places the country at the forefront of the global green energy transition.
