India’s power utilities sector is poised for long-term growth, driven by robust renewable energy additions, resilient coal production, and government policies promoting supply-side readiness. Despite a near-term moderation in electricity demand, structural factors such as energy transition, rising electrification, and economic growth are expected to support sustained sectoral momentum. Peak power demand is projected to reach 270GW in FY26, with a potential for a sharp rebound in the near term due to demand volatility in peak months.
The sector has seen significant capacity additions, with a 33.3GW increase in total generation capacity in FY25, driven by renewable energy sources. Solar energy accounted for 23.8GW of the additions, while wind energy contributed 5GW. The Ministry of Power has taken steps to ensure peak season preparedness, including directing gas-based power plants to maximize generation during summer months.
Coal availability remains solid, with domestic coal production rising 3.6% YoY to 81.6MT in April 2025. The government has also taken steps to ease supply for imported coal-based plants. Average Day-Ahead Market (DAM) rates have remained stable, while Real-Time Market (RTM) prices have dipped 24% YoY in May.
The sector is entering a structurally resilient phase, with a strong pipeline of RE projects, policy thrust on thermal reliability, and rising energy needs. Companies such as Suzlon Energy and JSW Energy are well-positioned for growth, with improving execution, strong earnings momentum, and a robust project pipeline. Suzlon Energy is expected to deliver 2.4GW in FY26, implying a quarterly run rate of 600MW, while JSW Energy has reported strong operational capacity and a robust project pipeline.
The author recommends a “Buy” rating for both Suzlon Energy and JSW Energy, citing clear growth visibility, strong capacity additions, and improving earnings momentum. However, it is essential to note that the recommendations and views expressed are those of the author and do not represent the views of the Economic Times. Overall, India’s power utilities sector is poised for sustained investment and operational growth in FY26 and beyond, driven by strong fundamentals and government support.