Green Stocks Nov 4- No Respite For Green Pack Despite Good Results

Pressure on the green pack continued in November, despite the continuing positive results from constituents of our pack. today, it was the turn of Acme Solar (late evening yesterday) and  Suzlon Energy today to deliver strong numbers, with net profits going up significantly in both cases. This expansion in margins has looked sustainable increasingly, in a benign interest rate environment with a healthy order book. 

Also, despite how the market might have reacted to reported moves by the government to cancel awarded tenders that are still to find buyers for the energy they produce it will actually clear up muddied waters for the sector. Many of these tenders were hogging scarce transmission capacity, which will also be freed up for newer, lower priced projects to move ahead.
At 40 GW, projects at risk sound like a lot, except when you see the 50 GW of remaining projects which could move ahead faster now. The moves are also symptomatic of the sheer speed of change in the sector, where two years can sound like a lifetime, as seen in the way BESS costs have changed with a sharp drop. Unlike, say, the Hydro, coal-based or nuclear sectors, where prices have shifted only steadily upwards over the past few years.        

With a large part of the green pack due to announce results by the weekend, we believe we will have a clear idea of the way expectations, and consequently valuations, have shifted over the past six months for these firms. Until then, hold on to your seats for a volatile ride.