Expensive Thematic Stocks Have Delivered Returns

Research evidence excerpt

Expensive Thematic Stocks Have Delivered Returns

India | Equity Strategy EquityJuneResearch17, 2026

STRATEGY NOTEExpensive Thematic Stocks Have Delivered

Returns

The last 15 years has witnessed several examples (8 listed below) of Exhibit 1 - Power Utilities stocks performance

vs Nifty since Dec'24

(Rebasedinvestment themes emerging, valuations surging to a seemingly expensive 150 to 100 as on PE: +46%Jun'26 31st Dec'24)

140 avg

level but yet delivering strong returns over the subsequent 2-3 years. We 130 above 10Y

believe that pvt power cos have entered this thematic stage. El-Nino led YoY 120110

demand surge would be the near-term +ve. Our top picks are JSWE, AESL, 10090

Premier & Siemens Energy. This fits in well with our broader 'Hard asset' 80 Dec-24 Jan-25 Feb-25 Mar-25 Apr-25 May-25 Jun-25 Jul-25 Aug-25 Sep-25 Oct-25 Nov-25 Dec-25 Jan-26 Feb-26 Mar-26 Apr-26 May-26 Jun-26

theme also. . PowerNifty50UtilitiesIndex (NTPC, Powergrid, Adani Energy, Adani Green, Adani Power, JSWE) Index

Source: Factset, Jefferies

Power has emerged as a strong theme; multiple levers. Supply- and demand-side drivers Exhibit 2 - Power Equipment stocks

are aligning, positioning power stocks among the best structural plays. Core demand growth performance vs Nifty since Dec'24

Jun'26

to 100 as on PE: +65% above 31st Dec'24)

10Y avgof ~6% cagr has strong visibility, with upside potential from rising data center demand and 225200 (Rebased

renewed govt focus on energy security and electrification. On the supply side, select private 175

sector cos. are leading capex with capacity growth of 11-29% cagr, vs. 4% for the govt. sector 150125

- ensuring viability. Technological innovations such as BESS are lowering renewable power 100

costs.