NTPC peer IPO coming soon? BJP win in Bengal raises hopes of Damodar Valley listing

NTPC’s peer Damodar Valley Corporation (DVC) could be headed for a long-awaited stock market debut, with the Bharatiya Janata Party’s (BJP) victory in the West Bengal assembly elections reviving expectations of an initial public offering (IPO) in the central utility.

Analysts say the change of guard in West Bengal removes a key political overhang that had stalled New Delhi’s plan to list DVC, a central public sector undertaking (PSU) under the Ministry of Power that is often seen as a smaller peer to NTPC.

“The Government of India has been discussing the listing of DVC, which was facing challenges due to strained relations with the West Bengal government. We expect this to be expedited,” JM Financial Institutional Securities said.


DVC, which operates in power generation, transmission and distribution across Jharkhand and West Bengal, reported revenue of Rs. 23,900 crore in FY25, earnings before interest, tax, depreciation and amortisation (EBITDA) of Rs. 5,500 crore and net profit of Rs. 1,200 crore, according to the brokerage.

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The corporation has 6,540 MW of thermal capacity and 147 MW of hydro power, and services a contract demand of 3,393 MVA across the two eastern states.

JM Financial argues that West Bengal has historically played an outsized role in India’s power sector, aided by early industrialisation, coal reserves and a pioneering role in private power supply, and that the BJP’s win is likely to trigger governance-focused reforms that could unlock value in central and state utilities.

“Results of the recent assembly elections suggest the BJP will form the government in the state. This may provide a fillip to reforms in the sector considering the party’s track record both at the Centre and in states where it is in power,” the report noted.

A more collaborative Centre–state equation is expected to ease long-pending issues between DVC and the West Bengal government, clearing the way for a stock market listing that had been delayed despite New Delhi’s push to monetise PSU assets.

The brokerage highlights that DVC’s shareholder structure, 35% held by the Union government, 34% by Bihar and 31% by West Bengal, had previously complicated decision-making around listing and governance changes.

Power stocks in focus

The potential DVC IPO is being read in conjunction with broader reform signals, including a higher probability of passage of the Electricity (Amendment) Bill, 2025, and a likely push for competition in distribution and support for Coal India’s West Bengal initiatives.

“With BJP government in WB and first-time government of a debutant party in Tamil Nadu (both large Indian states), we expect higher probability of its passage in upcoming monsoon session,” JM Financial said, referring to the Bill that seeks to enable parallel licensing, sharing of distribution networks and cost-reflective tariffs.

The brokerage also pointed out that listing DVC would add another listed central power utility alongside NTPC, giving investors a fresh way to play the eastern-region generation and transmission story and deepening the sector’s PSU equity universe.

For power utility CESC, the regime change could be negative as the new government in the state could take steps to allay the public’s concerns on high tariffs and other operations, JM Financial said.

At the same time, the news is positive for Coal India. "Like BJP governments in other states, a major focus of the new state government is likely to be on law and order, which may facilitate faster execution of various new projects of Coal India including coal gasification," it said.