NTPC, NLC, CESC top stock picks; brokerage sees margin pressure for Waaree, Premier, Vikram Solar, Emmvee
According to Elara Capital, power generation increased 11.2 per cent year-on-year (YoY) to 536 billion units (BU) in the second quarter of FY27. Generation rose 10.58 per cent YoY to 181 BU in July, 11.8 per cent to 180 BU in August and 11.2 per cent to 173 BU in September.
- Oct 8, 2026,
- Updated Oct 8, 2026 9:38 AM IST
Elara Capital expects mixed earnings across its power and renewable energy coverage universe for the September quarter (Q2 FY27), with regulated utilities likely to remain stable, while renewable equipment manufacturers could face margin pressure from higher commodity costs and competition.
The brokerage's preferred picks in the sector are NTPC Ltd, NLC India Ltd and CESC Ltd.
According to Elara Capital, power generation increased 11.2 per cent year-on-year (YoY) to 536 billion units (BU) in the second quarter of FY27. Generation rose 10.58 per cent YoY to 181 BU in July, 11.8 per cent to 180 BU in August and 11.2 per cent to 173 BU in September.
Coal-based generation grew 13 per cent YoY to 343 BU, while hydro generation declined 20 per cent to 59.7 BU amid a weaker monsoon. Renewable energy generation, meanwhile, increased 33 per cent YoY to 101 BU.
Peak power demand remained elevated during the quarter. It stood at 270 GW in July, up 23 per cent YoY, before moderating to 258 GW in August and reaching 269 GW in September, up 17 per cent YoY.
Elara said the elevated demand backdrop supported electricity trading activity on the Indian Energy Exchange (IEX). The exchange's traded electricity volume rose 12.7 per cent YoY to 39,685 million units (MU) in Q2FY27.
The average market clearing price in the Day Ahead Market (DAM) rose 46 per cent YoY to Rs 5.7 per unit, while the Real-Time Market (RTM) price increased 49 per cent to Rs 5.2 per unit.
Elara expects regulated utilities, including NTPC, NLC India, Power Grid Corporation of India, SJVN and NHPC, to report stable earnings, supported by assured returns on their regulated equity base.
The brokerage expects IEX to deliver healthy earnings on continued volume momentum, while Adani Energy Solutions is likely to report strong growth, led by incremental revenue contribution from its energy solutions business.
Elara has a 'Buy' rating on NTPC with a target price of Rs 466, implying a potential upside of 45 per cent from its assessed market price. It has an 'Accumulate' rating on NLC India with a target of Rs 387, indicating a potential upside of 52 per cent.
CESC is also rated 'Buy', with a target price of Rs 228, implying a potential upside of 70 per cent from the brokerage's assessed market price. Margin pressure seen for renewable equipment makers
Elara expects the second quarter to remain seasonally weaker for renewable generators, with monsoon-related factors affecting capacity addition and utilisation. It expects companies such as JSW Energy and Adani Green Energy to see some impact from lower utilisation in Q2FY27.
ACME Solar, however, is expected to benefit from incremental revenue from its battery energy storage business and merchant operations.
In the renewable equipment space, Elara expects Waaree Energies, Vikram Solar, Emmvee Photovoltaic and Premier Energies to face margin pressure amid higher commodity costs and competition.
The brokerage has an 'Accumulate' rating on Waaree Energies and Emmvee, while it has assigned a 'Reduce' rating to Premier Energies. Vikram Solar has a 'Buy' rating with a target price of Rs 261, implying a potential upside of 72 per cent from Elara's assessed market price.
Elara Capital expects mixed earnings across its power and renewable energy coverage universe for the September quarter (Q2 FY27), with regulated utilities likely to remain stable, while renewable equipment manufacturers could face margin pressure from higher commodity costs and competition.
The brokerage's preferred picks in the sector are NTPC Ltd, NLC India Ltd and CESC Ltd.
According to Elara Capital, power generation increased 11.2 per cent year-on-year (YoY) to 536 billion units (BU) in the second quarter of FY27. Generation rose 10.58 per cent YoY to 181 BU in July, 11.8 per cent to 180 BU in August and 11.2 per cent to 173 BU in September.
Coal-based generation grew 13 per cent YoY to 343 BU, while hydro generation declined 20 per cent to 59.7 BU amid a weaker monsoon. Renewable energy generation, meanwhile, increased 33 per cent YoY to 101 BU.
Peak power demand remained elevated during the quarter. It stood at 270 GW in July, up 23 per cent YoY, before moderating to 258 GW in August and reaching 269 GW in September, up 17 per cent YoY.
Elara said the elevated demand backdrop supported electricity trading activity on the Indian Energy Exchange (IEX). The exchange's traded electricity volume rose 12.7 per cent YoY to 39,685 million units (MU) in Q2FY27.
The average market clearing price in the Day Ahead Market (DAM) rose 46 per cent YoY to Rs 5.7 per unit, while the Real-Time Market (RTM) price increased 49 per cent to Rs 5.2 per unit.
Elara expects regulated utilities, including NTPC, NLC India, Power Grid Corporation of India, SJVN and NHPC, to report stable earnings, supported by assured returns on their regulated equity base.
The brokerage expects IEX to deliver healthy earnings on continued volume momentum, while Adani Energy Solutions is likely to report strong growth, led by incremental revenue contribution from its energy solutions business.
Elara has a 'Buy' rating on NTPC with a target price of Rs 466, implying a potential upside of 45 per cent from its assessed market price. It has an 'Accumulate' rating on NLC India with a target of Rs 387, indicating a potential upside of 52 per cent.
CESC is also rated 'Buy', with a target price of Rs 228, implying a potential upside of 70 per cent from the brokerage's assessed market price. Margin pressure seen for renewable equipment makers
Elara expects the second quarter to remain seasonally weaker for renewable generators, with monsoon-related factors affecting capacity addition and utilisation. It expects companies such as JSW Energy and Adani Green Energy to see some impact from lower utilisation in Q2FY27.
ACME Solar, however, is expected to benefit from incremental revenue from its battery energy storage business and merchant operations.
In the renewable equipment space, Elara expects Waaree Energies, Vikram Solar, Emmvee Photovoltaic and Premier Energies to face margin pressure amid higher commodity costs and competition.
The brokerage has an 'Accumulate' rating on Waaree Energies and Emmvee, while it has assigned a 'Reduce' rating to Premier Energies. Vikram Solar has a 'Buy' rating with a target price of Rs 261, implying a potential upside of 72 per cent from Elara's assessed market price.