Suzlon, IEX, Inox Wind, ACME, NTPC, Power Grid, Tata Power shares: Top 3 power stock ideas

Nuvama Institutional Equities in its latest note on power sector said demand remained strong in the June quarter, growing 8.9 per cent year-on-year (YoY), driven by an intense summer that pushed peak power demand to 270GW in May 2026, further supported by delayed monsoon. The brokerage suggested 'Buy' rating on four stocks including NTPC Ltd, CESC Ltd, Inox Wind Ltd and ACME Solar Holdings Ltd. It suggested 'Hold' on Suzlon Energy Ltd, a similar view was maintained on Tata Power Cmopany Ltd and Power Grid. Indian Energy Exchange Ltd (IEX) was rated 'Reduce'

Nuvama said transmission rollout improved marginally in Q2 on the infrastructure front, as Right of Way (RoW) issues eased, although labour shortages persisted, particularly for EPC players, and were further exacerbated by the ongoing Middle East conflict.

"Labour constraints are expected to ease in H2FY27, paving the way for smoother execution. Demand has remained robust in YTDFY27, with 9.3 per cent growth, while RE additions are gathering pace, with 45–50GW expected in FY27. Overall, the macro demand remains favourable, and we remain directionally positive on generation (Thermal/RE) and transmission sector momentum," Nuvama said.

Its three top picks from the sector are ACME Solar with a target of Rs 448, NTPC with a target of Rs 445 and Power Grid Rs 283.

"NTPC remains one of our top picks given steady 16–17% core RoE and a 9.4 per cent adjusted consolidated EPS CAGR over FY26–28E (RE-led growth) while trading at a mere 1.4 times FY28E P/BV. This is despite factoring in near term growth challenges in RE," it said.

On ACME Solar,  Nuvama said it is factoring in BESS sales of 7–10 GWh, delayed solar capex as 900MW spilt over to FY28 from FY27 on transmission GNA issues and Rs 2,800 crore QIP dilution.

For Suzlon Energy, Nuvama suggested a target of Rs 51. Target for Tata Power is set at Rs 400, IEX at Rs 118 and CESC at Rs 212.

In the case of Suzlon, Q1 execution was 506MW against the estimate of 555 MW, with 15.5 per cent Ebitda  margin, resulting in a PAT miss of 20 per cent. The Management highlighted 10–20 per cent shortfall in execution due to temporary logistic disruptions arising from the geopolitical situation, certain strategic investments and change of scope and segment mix while maintaining 17–18 per cent target Ebitda margin band.

In the case of CESC, Nuvama said Q1 PAT grew a subdued 4 per cent YoY as strong power demand-led price increase drove higher generation and lowered power purchases. Haldia was hit by higher borrowing costs despite strong PLF in Q1, while performance of Rajasthan franchises and Dhariwal improved even as Malegaon losses remained elevated, it said.

"Though CMP captures tariff hikes/RA recovery, valuations underplay the strong RE pipeline with growth likely to pick up by FY29–30E," it said.