NLC India Approves Share Sale in Renewable Energy Arm IPO and ₹2,500 Crore Bond Issue

Public sector power major NLC India has approved a proposal to sell up to 10 crore shares in the upcoming initial public offering of its renewable energy subsidiary. Alongside the IPO plans, the board cleared a ₹2,500 crore bond fundraise while reporting financial results for the September quarter.

State-owned lignite and power major NLC India announced on Wednesday that its board has approved a proposal to sell up to 10 crore shares as part of the listing process for its renewable energy subsidiary, NLC India Renewables Ltd (NIRL).

The company's board had previously cleared a ₹4,000-crore initial public offering (IPO) earlier this year. According to the company's timeline, the public listing of the renewable energy arm is expected to take place in fiscal year 2027.

In addition to the equity dilution plans for NIRL, NLC India also approved a separate fundraise of ₹2,500 crore through the issuance of bonds in the nature of debentures.

The board approvals coincided with the release of the company's financial performance for the quarter ended September 2026. NLC India reported a net profit of ₹465 crore for the quarter, marking a decline compared to the ₹921 crore recorded in the corresponding period of the previous year. According to the company, the lower net profit was driven by an increase in fuel prices and the absence of a ₹113 crore inventory-related benefit that was recorded in the year-ago quarter.

Despite the dip in net profit, NLC India's revenue from operations for the quarter registered an increase, standing at ₹4,732 crore compared to ₹4,178 crore in the same period last year.

On the operational front, the company reported coal production of 78.55 lakh tonnes (lt) for the first half of fiscal year 2026. This represents a 4.92 percent growth compared to the 74.87 lt produced during the same period in the previous fiscal year.

Following the announcements and financial disclosures, shares of NLC India closed 8.97 percent higher at ₹250.98 apiece on the National Stock Exchange (NSE) on Wednesday.

"NLC India's decision to move forward with the share sale for its renewable energy subsidiary highlights the growing strategic focus on green energy assets within traditional power sectors. While quarterly profits faced headwinds from rising fuel costs and baseline adjustments, tapping the debt market through a ₹2,500 crore bond issue alongside the planned ₹4,000-crore IPO indicates a structured approach to capital management. For public sector enterprises, spinning off and listing green arms provides a dedicated mechanism to fund renewable expansion while unlocking subsidiary value for investors ahead of the FY27 target." — Dr. Shishir Gupta, Founder & CEO, StartupLanes