Jefferies: Power Sector Upside & Top Stock Picks in India

India’s power sector is positioning for a robust growth phase, propelled by escalating electricity demand and substantial investments in renewable energy. Investment bank Jefferies highlights that a potential below-average monsoon, likely influenced by El Niño, could further intensify power demand across the nation.

This confluence of factors underpins a favorable outlook for the sector. Jefferies projects a significant 7% power-demand growth for the fiscal year 2027, followed by a 6% compound annual growth rate extending through FY30.

Jefferies’ Key Projections

• Power demand growth (FY27): 7%
• CAGR through FY30: 6%

Against this backdrop, Jefferies has pinpointed several power stocks exhibiting notable upside potential. Torrent Power leads with a projected 28% upside, closely followed by JSW Energy and Adani Power, both indicating a 27% potential gain.

Detailed Upside Potential & Ratings

• Torrent Power: ‘Buy’ rating, target price Rs 1,780 (28% upside).
• Adani Power: ‘Buy’ rating, target price Rs 270 (27% upside).
• JSW Energy: ‘Buy’ rating, target price Rs 720 (27% upside).
• Adani Energy Solutions: ‘Buy’ rating, target price Rs 2,060 (26% upside).
• Adani Green Energy: ‘Buy’ rating, target price Rs 1,695 (24% upside).
• NTPC: ‘Buy’ rating, target price Rs 425 (23% upside).
• Power Grid: ‘Buy’ rating, target price Rs 315 (17% upside).
• Tata Power: ‘Underperform’ rating (7% downside).
• Indian Energy Exchange: ‘Underperform’ rating (15% downside).

Beyond these specific stock recommendations, the broader sector demonstrates strong underlying momentum. Recent data reveals an 11% year-on-year increase in power demand for July 2026, with peak demand reaching 270 gigawatts.

Broader Sector Tailwinds

• July 2026 power demand: Increased by 11% year-on-year.
• Peak demand reached: 270 gigawatts.
• Renewable energy awards (FY27 through July): 4.2 gigawatts.
• Planned investment for Intra-State Green Energy Corridor Phase III: Rs 54,000 crore, to evacuate 135 gigawatts of renewable capacity.

The convergence of robust demand recovery, strategic investments in green energy infrastructure, and favorable meteorological conditions sets a compelling stage for India’s power sector, as highlighted by Jefferies’ analytical assessment.