Nomura has initiated coverage on Acme Solar Holdings with a 'Buy' rating and a target price of Rs 505, and on NTPC Green Energy with a 'Neutral' rating and a target price of Rs 100, identifying energy storage as a critical technology to address the challenges arising from rising renewable energy penetration in India's electricity mix.
India's renewable capacity, excluding hydro, grew from 46 GW in FY16 to 223 GW in FY26, supported by renewable energy resources, government policies and declining tariffs. The share of renewable energy in power generation rose from around 1% in FY06 to 17% in FY26.
However, the increased share of renewable energy is creating grid-level challenges, including falling thermal utilisation during the day, peak usage at night and curtailment of solar generation.
"The increased RE share in India's electricity mix is leading to issues such as grid instability and a mismatch in the timing of power generation and consumption, as there are variability and intermittency issues related to renewables," Nomura said.
"Energy storage has become necessary, to resolve the issue of oversupplied solar energy during the day and to utilize it during non-solar hours and, thus balancing the renewable power scale," the brokerage said.