Nifty is falling, but this sector is rising — Are you invested?

Brokerages remain positive on energy stocks, highlighting strong growth visibility and a sustained investment cycle, even as broader markets show weakness.

The Nifty Energy index continues to show resilience, declining 34.05 points or 0.09 per cent to 37,140.55.

The index has gained 4.88 per cent over the past week and 2.90 per cent over the past month. It is up 7.85 per cent over three months, 5.18 per cent over six months and 4.53 per cent so far in 2026. Yearly, it has risen 14.52 per cent.

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In comparison, the Nifty 50 has declined 7.88 per cent in three months, 6.04 per cent in six months and 9.34 per cent so far this year, indicating underperformance in the broader market.

HSBC bullish on renewable energy players

HSBC has initiated coverage on renewable energy companies with a positive outlook, citing strong capacity addition and improving earnings visibility.

On Acme Solar Holdings, the brokerage has initiated a ‘Buy’ rating with a target price of Rs 350 against a current market price (CMP) of Rs 283, implying an upside of about 24 per cent.

It said the company is one of India’s fastest-growing, vertically integrated independent power producers in renewable energy. Its contracted capacity of around 6 GW provides long-term earnings visibility, while FDRE projects and battery energy storage systems are expected to improve returns.

HSBC has forecast an EBITDA compound annual growth rate of about 72 per cent for the company over FY26-28.

The brokerage has also initiated a ‘Buy’ rating on CleanMax Enviro Energy Solutions with a target price of Rs 1,150 against a CMP of Rs 870, indicating an upside of about 32 per cent.

It said CleanMax is India’s largest provider of renewable energy solutions to commercial and industrial users. Strong growth is expected as more companies shift to green energy, which is estimated to be 30–45 per cent cheaper than grid power.

HSBC has projected an EBITDA CAGR of around 60 per cent for the company over FY26-28.

JP Morgan sees a multi-year upcycle

JPMorgan Chase said India’s high-voltage power equipment segment is in the midst of a decadal upcycle, supported by renewable energy expansion and grid investments.

The brokerage said the outlook remains strong over the next three to four years, supported by India’s plan to add around 470 GW of solar and wind capacity over the next decade.

It also highlighted rising adoption of high-voltage direct current technology, with multiple projects planned to evacuate around 80 GW of renewable energy by FY36, implying a potential order opportunity of about USD 14–15 billion over five to six years.

Exports are expected to further support growth due to rising global demand for grid upgrades, renewable integration and power demand linked to artificial intelligence.

Jefferies on Power Sector

Jefferies said power demand rose 2 per cent year-on-year in March 2026, while FY26 demand growth remained weak at around 1 per cent due to above-average monsoons.

The brokerage expects demand to recover to around 6 per cent year-on-year in FY27, supported by improving conditions. It added that a 60 per cent probability of El-Nino could provide further upside to demand.

The Ministry of Power has projected peak electricity demand to rise 10 per cent year-on-year to 270 GW in FY27. Jefferies said JSW Energy and NTPC remain its top picks in the sector.

Morgan Stanley In Line View

Morgan Stanley maintained an ‘In Line’ view on the broader energy sector, noting that overall fuel demand growth remained muted at 1.5 per cent year-on-year in March. However, transport fuel demand remained strong, with petrol and diesel consumption rising 8 per cent year-on-year.

LPG demand declined 13 per cent due to supply disruptions, while industrial demand remained weak due to feedstock constraints. Excluding LPG, demand growth stood at around 5 per cent year-on-year, indicating underlying strength.

The brokerage also noted that fuel oil demand surged 34 per cent year-on-year as users shifted from gas, while refining margins are expected to remain about 1.5 times above mid-cycle levels.

Mixed ratings on key equipment makers

JP Morgan has initiated coverage on key power equipment companies with varied ratings. Siemens Energy India, it has been assigned a ‘Neutral’ rating with a target price of Rs 2,600 against a CMP of Rs 2,818, implying a downside of about 8 per cent.

The brokerage has initiated an ‘Overweight’ rating on Hitachi Energy India with a target price of Rs 29,000 against a CMP of Rs 28,424, indicating a marginal upside of about 2 per cent.

It has also given an ‘Overweight’ rating on GE Vernova T&D India with a target price of Rs 4,300 against a CMP of Rs 4,098, implying an upside of about 5 per cent.

Structural tailwinds support sector

Brokerages said the energy sector is benefiting from structural tailwinds, including renewable energy expansion, grid investments and rising power demand.

They added that transmission infrastructure development and energy transition initiatives are supporting long-term growth visibility. The cost advantage of green energy over conventional power is also driving adoption among commercial and industrial users.