India Electric Utilities: Recent Power Demand Pick-Up: Key Signals for 2H

Research evidence excerpt

India Electric Utilities: Recent Power Demand Pick-Up: Key Signals for 2H

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22 Jun 2026 22:28:41 ET │ 18 pages

India Electric Utilities

Recent Power Demand Pick-Up: Key Signals for 2H

CITI'S TAKE

Mohit Pandey AC

Power demand metrics have recovered robustly in 1QFY27, with recent peak +91-22-6175-9734

demand trends highlighting renewed demand supply mismatch during mohit.pandey@citi.com

non-solar hours. 21st May peak of ~271GW showed non-solar gap of 2.57GW

v/s 0.18GW solar hour. While we recognize very near-term demand trends Anusha Madireddy

will likely moderate on monsoon onset, the underlying pressures on the grid +91-22-6175-9866

during high heat intervals remain a challenge. As noted earlier, El Niño linked anusha.madireddy@citi.com

impact (higher demand, risks to hydro output) in 2HCY26 (CY24 saw 2H

peak in Sep) can potentially widen the solar/non-solar asymmetry. Though

capex upcycle is already ongoing, we see likelihood of policy measures in 2H

(such as Section 11 continuation). We remain constructive on electric utility

stocks. NTPC is our top pick supported by relatively undemanding

valuations and broadest pipeline across key generation capacity addition

areas. Tata Power (Mundra section 11) and JSWEL (merchant prices) also

stand to benefit, in our view.

Power demand pick-up — Peak power demand in India saw a sharp increase in May

2nd half, with peak power demand at ~271GW up ~10% v/s CY25 peak of 245GW (up

~17% v/s May25 peak). While daytime peaks are largely met - aided by solar

generation providing over 25% of the mix - the grid faces tightness once solar

generation falls, leading to an increase in exchange spot prices. Nighttime power

tightness increased with 3.6GW non-solar hour gap reported on 26th May.