印度电力：电价——峰值已过，短期形势严峻，但我们对中期看法不同...

(implying ~1-2% of generation gotwww.bernsteinresearch.com BERNSTEIN TICKER TABLETickerRatingNTPC.INOPWGR.INORNWOADANIGR.INUPOWF.INORECL.INOIEX.INUWAAREEEN.INUPREMIERE.INUASIAXO - Outperform, M - Market-Perform, U - Underperform, NR - Not Rated, CS - Coverage SuspendedPWGR.IN, RNW, ADANIGR.IN valuation is EV/EBITDA (x); WAAREEEN.IN, PREMIERE.IN base year is 2025;Source: Bloomberg, Bernstein estimates and analysis.INVESTMENT IMPLICATIONSThese developments make life tough for a renewable player- DISCOMs incrementally reluctant to sign PPAs, where it is signed- grid constraints and land availability might restrict PPA starts and where forced to sell on merchant it would literally be socialservice. We think one should stay hidden in entities with regulated returns. Company wise impact: Positive to neutral to negative.IEX: Positive event, as supply volumes should increasePower Grid: Limited impact, big enough pipeline and transmission a big constraintNTPC: Limited impact, merchant is small part of sales and renewables pipeline big enough with PPA signedPFC-REC: Limited near term impact, but does impact loan book growth medium termWaaree-Premier: Limited near term impact as order book full, but does impact demand-supply math 1-2 years outReNew: Merchant not that big, and mostly hydro asset. Negative medium term as PPA signing slows.Adani Green: Negative near term impact due to big merchant sales in solar hours.INDIA INDUSTRIALS AND INFRASTRUCTURE 2 DETAILSWHAT IS THE TREND IN SPOT POWER PRICES AND WHAT IS DRIVING IT?If we look at the trend of spot power prices in May, we see that Day spot prices continue to hit new lows every year, whereasevening power prices remain elevated and the gap between day-evening prices continues to rise.EXHIBIT 1:Spot power prices: While overall spot prices have come down, evening continues to be high, and the day-evening arbitrage has also increased in recent years012345678910May-2012Source: IEX, Bernstein AnalysisIf we compare with last year for the month of April-May, refer Exhibit 2 - we see two interesting insights:1. Even in weeks when power demand was higher in calendar 2025 vs. 2024, day power prices were lower, whereas eveningpower prices were even higher than last year.2. Sensitivity to power demand: Given the low depth of the power exchanges - a small dip in power demand causes a big swingin spot power prices - more in day hours than in evening hours.INDIA INDUSTRIALS AND INFRASTRUCTURE May-2013May-2014May-2015May-2016May-2017May-2018May-2019May-2020Merchant power prices in the month of May (Rs/kwh)Evening (6PM-12AM)Day (11AM-5PM)Night (1AM-6AM) May-2021May-2022May-2023May-2024May-2025Morning (7AM-10AM)AverageGap inmorning-evening powerprices continues to increase 3 EXHIBIT 2:Apr-May’25 vs. Apr-May’24: Day power prices consistently low, even on weeks when demand washigher. Further senstitivy of spot power prices to demand is very high2%37%25%27%-13%5%1%-20%-30%-34%-32%-9%-44%-16%-25%-62%-1%3%2%5%-4%-3%1%-9%-80%-60%-40%-20%0%20%40%60%1-6 April7-14 April16-21 April22-28 April29Apr-5 May6-12 May13-19 May20-27 MayChange in Spot power prices and power demand in April-May monthsEvening (6PM-12AM)- Power price change 2025 vs. 2024Day (11AM-5PM)- Power price change 2025 vs. 2024Power demand growth (y-o-y)Source: Grid India, IEX, Bernstein analysisWhat happened on the day prices hit zero?On 25thof May power prices hit zero, an early onset of monsoon lead to two events -peak demand was down 8%from lastyear and at the same time wind generation rose.Why were developers forced to sell at zero? Coal plants could not be backed down further- the available plants that day werealready running at 58% PLF at their low points. Their technical limit is ~55%.EXHIBIT 3:Generation Profile on day of zero power price: Thermal plants running close to minimum technicalduring afternoon hours. Wind generation high throughout the day.00:00AM0501001502002500:000:301:001:302:002:303:003:304:004:305:005:306:006:307:007:308:008:309:009:3010:0010:3011:0011:3012:0012:3013:0013:3014:0014:3015:0015:3016:0016:3017:0017:3018:0018:3019:0019:3020:0020:3021:0021:3022:0022:30Generation profile on 25th may 2025 (GW)ThermalGasHydroNuclearWindSolarOthersPeak Demand last year same day-222 GWPeak Demand-204 GW12:15 PMLowest thermalgeneration in the day:99GW(PLF-58%)Highest thermalgeneration in the day:148 GW(PLF-87%)00:00AMSource: NPP, Grid-India, IEX, Bernstein AnalysisINDIA INDUSTRIALS AND INFRASTRUCTURE 23:0023:30 WHO IS IMPACTED THE MOST?a) Renewable curtailmentRenewable curtailment is now a reality in India - what most don’t know is that the govt. has started sharing this data at statelevel. In the last week of may, Gujarat and Tamil Nadu bore the burden of curtailment. While everyone believes solar saw bigcurtailment, data suggests otherwise- wind curtailment last week was much more than solar, hitting a high of 3 GW windand solar both on 25th- Exhibit 6 and Exhibit 5. To make matters worse for developers, the