India’s renewable energy financing ecosystem has entered a phase of scale, diversification and institutional maturity, supported by stronger policy backing, higher budgetary allocations, rising foreign direct investment (FDI), expanding institutional lending and active public market participation. Capital pools have deepened across debt and equity, while a growing initial public offering (IPO) pipeline has created an additional avenue for fund mobilisation. At the same time, ease of doing business has improved, reflected in rising foreign participation, diversified funding sources, new corporate entrants and deeper market activity across asset classes.
Against this backdrop, Renewable Watch reviews the key debt, equity and IPO trends, as well as ease of doing business opportunities that have shaped India’s renewable energy sector in FY 2025-26…
Financing trends
Debt
Debt financing has emerged as a critical enabler of renewable energy growth in India, with both domestic and global investors increasingly opting for structured debt solutions. As per Renewable Watch Research, since FY 2025-26, $8.63 billion has been channelled through 47 debt deals. Over the past three months October-December 2025, collectively, $3,338.02 million has been secured in debt financing. Under the debt financing category, which covers loans, bonds and non-convertible debentures, development financial institutions (DFIs) formed a major source of overall funding (26 per cent) in the third quarter (Q3) of FY 2025-26, followed by industry (24 per cent) and commercial banks (22 per cent). Bond markets (15 per cent) are playing an increasingly important role in renewable financing as compared to previous quarters.
The funding mix highlights the growing participation of public and multilateral institutions alongside private lenders. PSU non-banking financial institutions such as REC Limited; DFIs such as the Asian Development Bank (ADB), the Japan Bank for International Cooperation (JBIC) and the National Bank for Financing Infrastructure and Development (NaBFID); and commercial and international banks such as Standard Chartered Bank and Sumitomo Mitsui Banking Corporation have also been the key financiers of renewable
energy projects over the past year.
Some of the major debt deals that were signed since FY 2025-26 include NTPC Limited’s $750 million loan from Bank of Baroda and HDFC Bank to expand renewable energy capacity and for installing flue gas desulphurisation systems; ACME Solar’s $440.13 million loan from State Bank of India to develop a 400 MW firm and despatchable renewable energy (FDRE) project in Rajasthan; Khorlochhu Hydro Power’s $540.94 million loan from PFC Limited to finance the 600 MW Khorolchhu hydropower project; Brookfield’s $840.15 million loan from REC Limited to finance its hybrid renewable energy project
in Kurnool, Andhra Pradesh; and ACME Solar Holdings’ $528.73 million loan from PFC, NaBFID and Yes Bank to finance and refinance renewable energy projects (FDRE and solar-plus-storage). These transactions over the past year indicate that both PSU and private developers are securing large, long-tenor loans, underscoring their critical role in renewable funding.
Beyond volume, the nature of financing has also evolved over the quarters. In Q1 FY 2025-26, most financings were expansion-led and greenfield-oriented. By Q2, refinancings begin to appear more clearly, and in Q3, it becomes prominent, including transactions by Adani Green Energy and repeat financings by ACME Solar Holdings.
Technology allocation also changed through the quarters. While solar remained the dominant asset class across quarters, hybrid and FDRE projects gained visibility, particularly in Q2 and Q3. Battery energy storage system (BESS) financing emerged in Q2 through transactions such as those by IndiGrid, while hydro and bioenergy deals featured in Q3. This diversification indicates improving lender confidence in more complex and despatchable renewable configurations, reflecting policy and grid integration priorities.
Equity
Private equity has continued to commit sizeable sums to scale capacities and consolidate portfolios. In FY 2025-26, equity funding totalling $4,342 million across 49 deals has been tracked by Renewable Watch Research. Transactions span acquisitions, stake purchases on renewable energy platforms, rights issues, qualified institutional placements (QIPs) and corporate joint ventures.
In Q1 FY 2025-26, the trend was clearly growth-capital-driven. Large equity infusions, such as NexGen Energia’s $1 billion raise and the Indian Renewable Energy Development Agency’s (IREDA) QIP of $234.7 million, indicate strong investor appetite for expanding platforms and strengthening balance sheets. Meanwhile, Q2 marked a shift towards a more diversified deal mix. While equity funding remained strong, there was a noticeable rise in acquisitions and strategic stake sales. Transactions such as SolarArise’s $160 million acquisition, Statkraft’s acquisition of Serentica Renewables (in the $223 million-$253 million range), and Ib vogt’s acquisition ($137 million-$160 million) highlight growing secondary market activity and increased participation by global infrastructure and private equity funds. In Q3, the $550 million acquisition of Vayona Energy stands out as one of the largest deals of the year. ReNew’s $190 million acquisition of a 300 MW solar project by Sembcorp Industries and Vibrant Energy’s $200 million acquisition by Inox Clean Energy further reinforce the shift towards strategic asset ownership. Recently, in January 2026, Inox Neo Energies Limited acquired 250-300 MWp of operational solar projects from SunSource Energy.
While solar continues to command structural dominance, the sector is gradually broadening, indicating increasing diversification within India’s renewable energy investment landscape. Meanwhile, storage and energy solutions, such as Waaree Energy Storage Solutions ($14 million) and VFlowTech ($20.5 million), are attracting capital, but ticket sizes remain comparatively smaller. Meanwhile, the generation versus manufacturing split also reveals an important pattern. High-value transactions ($150 million and above) are largely concentrated in generation platforms and project acquisitions. Manufacturing and equipment deals, while frequent, mostly fall in the $30 million-$160 million band. This suggests that while supply chain localisation is gaining traction, asset ownership continues to command the largest capital allocations.
IPO
The IPO landscape for renewable energy companies in the first three quarters of FY 2025-26 reflects strong fundraising intent, but selective execution. In Q1, IPO issuances worth $1,185.97 million were tracked in the pipeline through draft red herring prospectus (DRHP) filings, indicating healthy market confidence at the start of the fiscal year. The momentum intensified in Q2, when the pipeline rose sharply to
$2,343.3 million – the highest across the three quarters – signalling aggressive filing activity and strong capital market interest in the sector.
However, actual capital mobilisation through IPO issuances was significantly lower than the pipeline figures. In Q2, companies raised $383.86 million in fresh issue capital (excluding offer for sale). This suggests that while many companies initiated listing plans, only a fraction progressed to execution within the same quarter. Meanwhile, in Q3, the pipeline moderated sharply to $641.31 million, indicating a slowdown in fresh DRHP filings compared to Q2. Despite this, actual capital raised remained strong at $356.65 million (fresh issue, excluding offer for sale). This implies improved conversion of pipeline into executed deals and stronger transaction closure during the quarter.
Ease of doing business drives clean energy capital
India’s renewable energy financing landscape reflects a marked improvement in ease of doing business, particularly when viewed through the lens of foreign capital participation. Policy liberalisation has played a foundational role. Since November 2022, 100 per cent FDI has been permitted under the automatic route for renewable energy generation and distribution projects. This regulatory shift has translated into tangible capital flows, with FDI rising 50 per cent year on year in FY 2023 and FY 2024, and total inflows reaching approximately $4 billion in FY 2025. The steady increase from under $1.4 billion in FY 2019 to $4 billion in FY 2025 signals structural investor confidence rather than episodic interest.
Some of the major foreign debt deals that were signed since FY 2025-26 include BluPine Energy’s $280.8 million deal from Standard Chartered for an FDRE project in Karnataka. Furthermore, to finance clean energy projects, PFC mobilised $401.05 million from JBIC. The trend continued in Q3 FY 2025-26, with ReNew raising $331 million from ADB to finance a wind-solar hybrid and BESS project in Andhra Pradesh. Moreover, Adani Green secured $250 milllion from DBS Bank, DZ Bank, Rabobank, and Bank SinoPac to refinance existing debt.
Meanwhile, some of the major foreign equity deals that were signed since FY 2025-26 include IREDA’s $234.7 million QIP from several institutional investors, including Société Générale and Morgan Stanley. Moreover, SolarArise’s $160.4 million acquisition by Neo Infra Income Opportunities Fund, and Statkraft’s $222 million-$253 million acquisition by Serentica Renewables highlight strong global strategic interest in Indian renewable platforms. The most significant transaction in Q3 was the $550 million acquisition of Vayona Energy by a consortium led by TPG and Mavco Investments, representing one of the largest foreign-backed renewable transactions during the period. Moreover, ReNew secured $190 million from Sembcorp Industries for the acquisition of a 300 MW solar project.
Parallel to rising foreign participation, the improving ease of doing business is evident in the growing entry of diversified domestic players. Companies including the Aditya Birla Group, Reliance Industries Limited and Indian Oil Corporation Limited, which were traditionally outside the clean energy domain, are now allocating substantial capital to renewables, signalling that the sector has matured into a mainstream business opportunity. Together, these trends suggest that ease of doing business in renewable energy financing is improving, supported by policy liberalisation, institutional maturity and expanding investor confidence.
The way forward
Going ahead, renewable financing in India is expected to be shaped by three trends: rising refinancing and balance sheet optimisation as assets mature; greater capital allocation towards hybrid, FDRE and storage-linked projects; and sustained participation from global lenders and diversified domestic conglomerates, strengthening long-term capital availability.
Sakshi Bansal
