Mergers and acquisitions (M&As) continue to be a key trend in the Indian renewable energy market, demonstrating the growing maturity of the sector. As the country remains a leading investment hotspot for renewable energy projects, financially strong domestic companies, including global investors, energy majors, private sector conglomerates and now even public sector undertakings (PSUs), are rapidly scaling their portfolios through large-scale acquisitions. In line with this trend, on February 12, 2025, ONGC NTPC Green Private Limited (ONGPL), a 50:50 joint venture between ONGC Green Limited and NTPC Green Energy Limited (NTPC’s green energy subsidiary), signed a share purchase agreement to acquire a 100 per cent equity stake in Ayana Renewable Power. The enterprise value of the transaction amounts to $2.3 billion, making the acquisition one of the largest in India’s renewable energy sector. The transaction was finalised with the National Investment and Infrastructure Fund (NIIF), British International Investment (BII) and Eversource Capital, all of whom were key investors in Ayana. The completion of the transaction remains subject to necessary regulatory approvals and the fulfilment of conditions precedent.
Ayana Renewable Power, founded in 2017, was majority-owned by NIIF, holding 51 per cent of the shares, while BII held 32 per cent and Eversource Capital the remaining 17 per cent through the Green Growth Equity Fund. Ayana had initially secured a $100 million investment from BII in 2018 to develop solar projects in India and neighbouring countries. Subsequent funding rounds in 2019 and 2021 saw NIIF and BII infuse additional capital, helping Ayana expand its portfolio across solar, wind and round-the-clock (RTC) projects. By the end of 2024, Ayana had scaled up to its current portfolio of approximately 4.1 GW of operational and under-construction assets. Its projects are located across resource-rich states and include long-term power purchase agreements with high credit-rated off-takers such as the Solar Energy Corporation of India, NTPC, Gujarat Urja Vikas Nigam Limited and Indian Railways.
The initial bidding round for Ayana’s acquisition also saw participation from global investors, including Masdar, Gentari, Sembcorp, PSP Investments and Brookfield, reflecting strong international interest in Indian renewable assets. By August 2024, ONGC, JSW Neo Energy and Sembcorp were shortlisted as final contenders for the acquisition, and ONGC finally emerged as the highest bidder in September 2024 as per media reports. By November 2024, NTPC also joined the process, partnering in the acquisition through a planned 50:50 green energy joint venture with ONGC.
The strategic intent behind ONGPL’s acquisition of Ayana also aligns with the long-term renewable energy objectives of its parent companies, ONGC and NTPC. The deal will help both companies meet their decarbonisation targets, with ONGC aiming for net zero Scope 1 and 2 emissions by 2038 and NTPC by 2050, as well as NTPC Green Energy’s target of 60 GW of installed renewable energy capacity by 2032. Their commitment to expand into renewables signals a shift for India’s PSUs, which traditionally have focused on conventional, fossil-based energy sources. The transaction provides ONGPL with an established renewable platform, facilitating faster scaling up and market penetration.
The transaction indicates the sector’s growing maturity, as buyers seek quality operational and under-construction assets to bypass the associated bureaucratic processes and development risks. Additionally, the sale of Ayana likely stems from the trend of infrastructure funds exiting mature renewable platforms once they achieve their target returns, and this transaction allows NIIF and other co-investors to monetise their investments. With high-capital buyers in the Indian market, investors are securing favourable valuations for exits, making renewable energy assets an attractive investment class.
The sector has seen several similar high-value acquisitions in the past, including JSW Energy’s acquisition of O2 Power’s 4.6 GW platform for $1.47 billion in December 2024 and Adani Green Energy Limited’s $3.5 billion acquisition of SB Energy’s 5 GW portfolio in October 2021. Compared to previous deals, ONGPL’s acquisition of Ayana stands out as it represents a PSU-led consolidation effort, whereas Adani and JSW are private sector players aiming for rapid expansion. Additionally, a common denominator among all three transactions was the role of sovereign wealth funds and private equity investors in initially developing these assets before selling them to domestic buyers.
In conclusion, this high-value acquisition of Ayana by PSUs such as ONGC and NTPC marks a strategic shift in the green energy expansion strategy of conventional power companies, as they are now moving towards inorganic routes to reach their clean power targets. This deal showcases the confidence of large deep-pocketed PSUs in Indian IPPs, setting an example for attracting future investments. While challenges such as high borrowing costs, land acquisition issues and transmission constraints remain key factors influencing deal activity, the demand for high quality renewable assets remains strong. Going forward, the road ahead for India’s renewable energy sector will likely see continued M&A momentum, driven by policy support and the growing participation of financial institutions.
