Green Stocks Oct 7: Red Monday For Green Energy Stocks

On a day when the broader market continued to slide, continuing from the losses suffered last week, the small-cap and midcap space, where a majority of green energy stocks reside, suffered heavy losses. That is evident when you see names like Waaree RTL, Shakti Pimps, and SWREL hit the lower circuits. Even heavyweights Tata Power, Adani Green, and JSW Energy could not escape, falling between 6% to 3% respectively. What that means is that stretched valuations (as compared to historical benchmarks) will slip very fast if firms slip up on Q2 results, and guidance going forward. Rising waters lift all boats, but the rise in stocks is set to become a little more selective going ahead.

This is especially important, considering the slew of IPOs from renewable energy firms, mostly manufacturers, lined up for a launch soon. Even as those firms watch with a little anxiety about the direction the markets take, they do have enough of a buffer to still raise money at attractive valuations, if their numbers have been good. Either way, the roller coaster just got a lot more steeper.