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India leads renewable energy M&A in Asia

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While North America and Europe dominate the global renewables landscape with regard to value and volume of investments, neither of these regions has witnessed the growth seen in Asia. As of the end of 2022, the aggregate transaction enterprise value for renewable energy generation assets has increased to nearly 5X the level it was in 2020, standing at $18bn, while transaction volume has surged to nearly 3X the 2020 level in the same time frame. The explosive growth in the region was driven primarily by increased M&A activity in India, a country that has emerged as one of the most attractive markets for renewable investments, globally. 

The Enerdatics research team has analyzed drivers of renewable energy M&A in India and summarised its analysis on a single slide, the highlights of which are:

– India has witnessed at least three $1bn+ deals for renewable energy assets in 2022 - a feat that has not been observed in any other Asian country in 2022. Deal volume in the country surged by 66% year on year (y-o-y) in 2022, exceeding increases in Japan, the Philippines, Vietnam, and Taiwan

– Large, integrated industrial conglomerates and private equity (PE) firms drove corporate M&A activity in India in 2022, with the deal volume largely comprising investments in gigawatt-scale portfolios of operational wind and solar assets

– Shell, JSW Energy, Adani Green Energy, BlackRock, Tata Power, Sembcorp, Hero Future Energies, KKR, and Partners Group lead the pack of companies that have made major moves in the Indian renewables market in 2022 

– While most of the transacted assets are backed by long-term utility power purchase agreements (PPAs), Enerdatics research shows that India witnessed more than a 3X y-o-y surge in corporate PPAs in 2022, driven by rising power demand from industrial and technology companies

– Strong power market fundamentals, stable political and fiscal regime, and exponential growth forecast in the industrial and technology sectors, relative to the other countries in the region, are believed to be the main contributors to India's dominance of Asia's M&A landscape

The above analysis is proprietary to Enerdatics’ energy analytics team, based on the current understanding of the available data. The information is subject to change and should not be taken to constitute professional advice or a recommendation.

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