The Indian renewable energy company ReNew plans to delist from Nasdaq after losing over 30 percent of its market value since its 2021 IPO. ReNew, India's second-largest provider in the renewable energy sector, is currently valued at around 2.4 billion US dollars.
According to a filing with the U.S. Securities and Exchange Commission (SEC) on December 10, a consortium of Masdar, the state renewable energy company of the United Arab Emirates, the Canada Pension Plan Investment Board (CPPIB), and the Abu Dhabi Investment Authority (ADIA) plans to take over ReNew for $7.07 per share. This is above the closing price of $6.34 on Tuesday.
ReNew CEO Sumant Sinha stated that the US listing undervalued renewable energy companies and hindered the transition to green energy. A possible re-election of Donald Trump, which could weigh on the shares of clean-energy companies, is also a factor for the withdrawal plan. Sinha also suggested that a future capital increase and a re-listing in India could unlock ReNew's growth potential.
Bernstein analysts see a high probability that the consortium could successfully pay off the remaining shareholders and privatize ReNew. A subsequent IPO in India would facilitate local market knowledge and capital raising.
The withdrawal from the Nasdaq comes at a difficult time for India's renewable energy sector. The industry was recently shaken by allegations of corruption against Gautam Adani and his company Adani Green Energy, casting a shadow over the entire industry.
Analysts also point to high levels of debt and volatile revenues, particularly due to ReNew's strong focus on wind energy. Morgan Stanley recently downgraded ReNew, citing low profitability and business fluctuations.
Despite Challenges, ReNew Remains a Key Player in India's Goal to Double Non-Fossil Energy Generation Capacity to 500 Gigawatts by 2030. In August, the Company Secured a Contract to Supply 440 Megawatts of Green Energy to Microsoft in India.
