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  • May 7, 2024 - This Green Energy Stock has Soared 1,000% in Eight Months. Can it Maintain the Momentum?

This Green Energy Stock has Soared 1,000% in Eight Months. Can it Maintain the Momentum?

May 7, 2024

This Green Energy Stock has Soared 1,000% in Eight Months. Can it Maintain the Momentum

The Indian stock market has witnessed a new star emerge from the power sector - Oriana Power.

Since its debut on the NSE SME platform in August 2023, the company has been nothing short of a meteoric rise.

Investors who took a chance on Oriana Power's IPO have been handsomely rewarded, with the stock price skyrocketing over 1,000% from the issue price of Rs 118 in a mere eight months.

This phenomenal growth trajectory isn't just a blip on the radar. Oriana Power has been consistently hitting upper circuits for the past month, culminating in a new 52-week high of Rs 1,939.9 on 6 May 2024.

What is Behind the Upward Movement of Oriana Power's Share Price?

The upward surge in Oriana Power's share price can be attributed to its consecutive order victories.

Since its inception, this green energy stock has consistently secured numerous orders, a trend that continued into 2024.

Most recently, the company announced the successful commissioning of a 29 MWp captive open-access solar power plant project for a prominent Karnataka-based steel manufacturer.

Oriana Power has been receiving multiple orders since the beginning of the year. Notably, in April, its wholly-owned subsidiary, Truere 100 Energy, clinched a prestigious contract for developing a 5 MWp solar power plant under the CPP segment. This project is expected to generate monthly recurring revenue over 25 years.

Additionally, Oriana Power sealed a significant deal for a 76.62 MW (AC) solar power plant, cementing its commitment to long-term relationships and renewable energy supply.

With an estimated development and construction cost of Rs 3.3 billion (bn), this contract underscores the company's dedication to providing sustainable solutions.

An exchange filing revealed that the project has been granted Rs 172.7 million (m) in Central Financial Assistance (subsidy), enhancing its viability and enabling cost-effective solutions.

In February 2024, the company secured a substantial contract to develop a Compressed Bio Gas (CBG) plant in Maharashtra, capable of producing 21 tons daily. This project is valued at Rs 5.6 bn.

As per the recent data, Oriana Power's order book stood at over 110 MW. Moreover, the company had an EPC order book of 65 MW to be executed by the end of the financial year.

They also expect to complete two additional orders, a 0.65 MW ground-mounted project for a textile company at Panipat in Haryana and a 0.53 MW rooftop solar power project for a packaging company in Bengaluru by the end of FY24.

Bio Gas Blending: A Golden Opportunity Ahead

The introduction of Compressed Bio Gas (CBG) blending obligations by the Ministry of Petroleum & Natural Gas presents a golden opportunity for Oriana Power to further expand its renewable energy portfolio and capitalise on emerging market trends.

The phased implementation of CBG blending obligations signifies a gradual shift towards cleaner and more sustainable fuel alternatives in the petroleum and natural gas sectors.

This transition creates a favourable environment for Oriana Power to leverage its expertise in renewable energy solutions, particularly in the development of bio-gas blending infrastructure and facilities.

As the mandatory blending obligations come into effect from FY 2025-26 onwards, Oriana Power can position itself as a key player in supporting the blending process.

The increasing blending percentages over the years, reaching up to 5% by 2028-29, indicates a growing demand for biogas blending solutions. Oriana Power can seize this opportunity to scale up its operations and contribute significantly to meeting the blending mandates.

By actively engaging in CBG blending initiatives, Oriana Power can achieve several strategic objectives. Firstly, it aligns with the company's mission to promote renewable energy adoption and reduce reliance on fossil fuels.

Second, it opens up new revenue streams and market opportunities in the evolving energy landscape.

Additionally, participation in CBG blending projects enhances Oriana Power's reputation as an innovative and socially responsible energy provider.

Oriana Power's Financial Performance

Oriana Power's financial performance over the past three years (2021-2023) paints a picture of a company on a steady growth trajectory.

The company has demonstrated revenue growth of 58.3% on a compounded annual growth rate (CAGR) basis over the period spanning from the financial years 2021 to 2023. This performance can be credited to the back-to-back order wins.

Similarly, the net profit has also increased steadily at a higher rate compared to revenue, with a CAGR of around 65.1%.

The net profit margin has also followed suit averaging around 5.6% over the three-year period.

Oriana Power's Financial Snapshot (2021-23)

Particulars 2020-2021 2021-2022 2022-2023
Revenues (Rs in m) 337.6 1,014.60 1,339.50
Revenue Growth (%) - 200.5 32.1
Net Profit (Rs in m) 28.2 69.5 126.8
Net Profit Margin (%) 3.3 5.6 8
Source: Company's DRHP

Its revenue surged by 398%, reaching Rs 3.2 bn in second half of the financial year 2024 . Similarly, net profits saw a remarkable increase of 750%, rising from Rs. 57.2 m to Rs. 486.2 m over the same period.

How Shares of Oriana Power have Performed Recently

The power sector stock has delivered a huge return of 140% in the last 30 days. In 2024 the stock is up over 300%.

Oriana Power touched its 52-week high of Rs 2,540 on 3 May 2024. Its 52-week low was Rs 1,235 touched on 15 May 2023.

Oriana Power Share Price Since listing

About Oriana Power

Founded in 2013, Oriana Power specialises in providing solar energy solutions to industrial and commercial customers.

The company provides low-carbon energy solutions through the installation of on-site solar projects, such as rooftop and ground-mounted systems, as well as off-site solar farms, i.e., open access.

The company's activities are mainly divided into two segments: Investments (CAPEX) and Renewable Energy Service Companies (RESCO).

Under the CAPEX model, services are offered for the design, procurement, construction, and operation of solar projects.

Under the RESCO model, the company operates through its 18 subsidiaries. The subsidiaries offer solar energy solutions based on a BOOT (build, own, operate, transfer) model, which allows customers to reap the benefits of solar energy without upfront investment.

For more details, see the Oriana Power company fact sheet and quarterly results. on our website.

You can also compare Oriana Power with its peers:

Oriana Power vs KPI Green Energy

Oriana Power vs BGR Energy

Investment in securities market are subject to market risks. Read all the related documents carefully before investing

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