Green with Envy: Now ONGC, NTPC arm may bid for Ayana Renewable Power

Oil and Natural Gas Corp (ONGC) is in talks to form a consortium with NTPC Green Energy to bid for National Investment and Infrastructure Fund-owned Ayana Renewable Power, according to people aware of the matter. They said ONGC and NTPC Green Energy may explore a joint offer or the former could bid solo.

Ayana’s enterprise value has been pegged at about $2 billion. JSW Neo Energy, Sekura Energy, Masdar, Macquarie and Sembcorp have submitted non-binding offers to acquire a controlling stake in the Bengaluru-headquartered renewable energy company, ET had first reported on May 4. NIIF will draw up a shortlist of bidders over the next few weeks after which they will be allowed to conduct detailed due diligence on the company and submit binding offers, ET had reported.

ONGC formed a new company in February to house its green energy investments. ONGC Green will invest in wind and solar power plants as well as green hydrogen and green ammonia. NTPC Green, which was carved out of listed NTPC two years ago, has announced plans for an initial public offering (IPO).


Operational Capacity of 1.3 GW

ONGC and NTPC Green have a joint venture for developing offshore wind energy projects.

ONGC and NTPC didn’t respond to queries.

NIIF owns a 51% stake in Ayana Renewable Power while British International Investment (formerly known as CDC Group) owns 32%. The Green Growth Equity fund of Eversource Capital owns 17%.

Ayana’s three co-investors led by NIIF have collectively pumped in $721 million as equity funding. It’s estimated that the company’s debt could be in the region of $1.2 billion, taking its enterprise value close to $2 billion.

British International Investment, in its previous avatar as CDC, had floated Ayana Renewable in 2018 to further the UK’s investments in green energy in India. NIIF became a controlling shareholder in December 2020.

Ayana has a total pipeline of more than 4 GW of solar, wind and hybrid power projects across several states and has an operational capacity of 1.3 GW of renewable energy in Andhra Pradesh, Karnataka and Rajasthan.

It has 2.8 GW of projects under development, with 2 GW of solar, wind and hybrid assets having firm power purchase agreements (PPAs). PPAs are yet to be signed for the remaining 800 MW of generation projects that it won through the bidding route. Of this, the group expects to commission a 300 MW wind power asset in the ongoing financial year and the rest through FY25 and FY26, subject to the timely signing of PPAs, according to an ICRA report.

ONGC chairman Arun Kumar Singh announced last year that the company would set up 10 GW of renewable energy projects by 2030. It would also look at other areas such as green hydrogen and green ammonia to meet its target of turning a net-zero carbon emission company by 2038. Its investments toward decarbonisation could add up to about Rs 1 lakh crore.