The renewable energy stocks are in focus. The global brokerage house, Jefferies in its latest report has outlined a list of its preferred picks.
According to the brokerage report, a mix of rising power demand, policy support, and global uncertainties is pushing energy security to the forefront.
Jefferies top pick in renewable sector stocks
JSW Energy remains its pick in the power space with a ‘Buy’ rating and a target price of Rs 660. This implies an upside potential of around 35%.
Jefferies has also maintained a ‘Buy’ rating on NTPC with a target price of Rs 440. This indicates a potential upside of about 16%.
In the solar manufacturing segment, the brokerage prefers Premier Energies and Emmvee, both of which are rated ‘Buy’.
Let’s take a look at the investment rationale driving the investment call –
Jefferies on Renewable Energy: Energy security driving the big shift
According to the Jefferies report, global geopolitical tension are pushing countries, including India, to reduce dependence on external energy sources.
It noted, “Geopolitics is driving focus on energy security. We expect India’s RE capacity to reach 359 GW by FY25-30.”
This means India is expected to significantly increase its renewable energy capacity over the next few years.
At the same time, the brokerage house in its report noted that the power demand has been relatively weak recently but is expected to improve.
It added, “Power demand was muted in FY25-26 and should recover to 6% growth in FY27.”
Jefferies on Renewable Energy: El Nino factor could boost demand
One interesting factor highlighted in the report is weather. As per Jefferies report, “El Nino could add to upside.”
Lower rainfall usually means higher electricity usage, especially for cooling and irrigation. The report explained, “Lower rainfall typically raises power demand from residential and agriculture segments which is 40-45% of India’s power demand.”
Jefferies on Renewable Energy: JSW Energy, NTPC emerge as top power picks
In the power generation segment, the brokerage has clearly identified its favourites. According to the brokerage report, “JSW Energy and NTPC are our top picks in power.”
The brokerage believes both companies are well placed to benefit from rising power demand as well as policy support.
Jefferies on Renewable Energy: Solar demand rising on policy push
The report also highlighted strong growth in solar energy installations. Government schemes are playing a key role here.
It noted, “The solar rooftop program (PM Suryaghar) has achieved ~9GW of installations in FY26, up from 5GW in FY25.”
Another scheme, PM Kusum, which focuses on solar-powered agriculture pumps, is also driving demand.
Jefferies on Renewable Energy: Why Premier and Emmvee are preferred
In the solar manufacturing space, the brokerage prefers companies with strong financial positions and order visibility.
According to the brokerage report, “Premier and Emmvee with strong balance sheets and healthy order books are preferred PV picks.”
Photovoltaic (PV) refers to solar panels that convert sunlight into electricity.
Jefferies’ report also pointed out that new government rules will require the use of domestically produced components such as ingots and wafers in solar projects.
It added, “Govt’s wafer/ingot mandate benefits PV players with strong balance sheets.”
What this means for investors
With rising demand, policy support, and global factors like weather and geopolitics coming into play, the sector could see steady momentum, as per Jefferies. However, execution, demand recovery, and policy continuity remain key factors to watch.
Disclaimer: The investment analysis and target prices mentioned above are based on reports by Jefferies and are for informational purposes only. These do not constitute a direct recommendation to buy or sell any security. Markets are subject to inherent risks, and investors are advised to consult with a SEBI-registered investment advisor before making any financial decisions.
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