Green Energy Sector Vs NBFC Sector

The Green Energy sector focuses on renewable energy sources like solar and wind, aiming for sustainable growth. In contrast, the NBFC sector offers financial services, focusing on lending and investments, with both sectors providing distinct opportunities and challenges for investors.

Green Energy Sector Overview

The Green Energy sector is centered on the production and utilization of renewable energy sources such as solar, wind, hydro and bioenergy. This sector is pivotal in addressing climate change, promoting sustainability and reducing dependency on fossil fuels for power generation.

Driven by global sustainability goals and government initiatives, the Green Energy sector continues to attract substantial investments. Technological advancements and cost reductions in renewable energy systems have made them more competitive, positioning this sector as a critical driver of long-term economic growth and environmental preservation.

NBFC Sector Overview

The Non-Banking Financial Company (NBFC) sector offers a range of financial services, including loans, leasing, insurance and asset management. These institutions play a vital role in promoting financial inclusion by providing access to credit for underserved populations and businesses.

The NBFC sector has seen rapid growth, fueled by increased demand for loans and financial products. However, it faces challenges such as liquidity risks, regulatory changes and rising non-performing assets (NPAs), which can impact profitability and stability. Despite these hurdles, NBFCs remain a critical component of the financial ecosystem.

Best Stocks In The Green Energy Sector

The table below shows the best stocks in the green energy sector based on a 1Y return.

Name	Close Price (rs)	1Y Return (%)
Ujaas Energy Ltd	458	2,012.55
Websol Energy System Ltd	1,499.55	244.92
Insolation Energy Ltd	292.95	153.29
Alpex Solar Ltd	723	109.29
Azad Engineering Ltd	1,555.00	57.36
Premier Energies Ltd	1,029.00	22.51
K.P. Energy Ltd	421.5	11.54
Suzlon Energy Ltd	53.84	9.32
BF Utilities Ltd	818	4.17
Waaree Renewable Technologies Ltd	960.55	-1.99

Top Stocks In The NBFC Sector

The table below shows the top stocks in the NBFC sector based on a 1Y return.

Name	Close Price (rs)	1Y Return (%)
Authum Investment & Infrastructure Ltd	1,796.55	102.81
Muthoot Finance Ltd	2,244.70	57.51
Motilal Oswal Financial Services Ltd	674	50.78
Rail Vikas Nigam Ltd	395	40.64
Cholamandalam Financial Holdings Ltd	1,470.20	27.26
Bajaj Finance Ltd	8,476.65	26.34
Sundaram Finance Ltd	4,646.90	21.98
Shriram Finance Ltd	560.6	16.13
Housing and Urban Development Corporation Ltd	206.4	4.3
Mahindra and Mahindra Financial Services Ltd	297.5	0.24

Fundamental Analysis Of Green Energy Sector

Ujaas Energy Ltd

Ujaas Energy Ltd, incorporated in 1999, is a key player in India’s solar power sector. The company specializes in solar power generation, manufacturing, sales and services of solar projects. Under its flagship brand ‘UJAAS’, it develops, operates and maintains solar energy plants while also manufacturing and selling electric vehicles.

Market Cap: ₹5,127.67 Crore

Close Price: ₹458

1Y Return: 2,012.55%

1M Return: -7.35%

6M Return: 40.92%

5Y Average Net Profit Margin: -69.43%

5Y CAGR: 160.2%

Sector: Renewable Energy

Websol Energy System Ltd

Websol Energy System Ltd is a leading manufacturer of photovoltaic crystalline solar cells and PV modules in India. The company specializes in producing high-quality solar components for commercial and industrial solar energy panels, catering to both domestic and international markets with innovative and efficient solar solutions.

Market Cap: ₹6,329.05 Crore

Close Price: ₹1,499.55

1Y Return: 244.92%

1M Return: -8.76%

6M Return: 113.76%

5Y Average Net Profit Margin: -108.01%

5Y CAGR: 120.07%

Sector: Renewable Energy

Insolation Energy Ltd

Insolation Energy Ltd, incorporated in 2015, specializes in manufacturing high-efficiency solar panels and modules of various sizes. The company operates a 200 MW solar PV module manufacturing unit in Jaipur, spanning over 60,000 sq. ft, equipped with advanced machinery to cater to the growing solar energy market.

Market Cap: ₹6,413.08 Crore

Close Price: ₹292.95

1Y Return: 153.29%

1M Return: -17.04%

6M Return: -7.56%

5Y Average Net Profit Margin: N/A

5Y CAGR: N/A

Sector: Renewable Energy

Alpex Solar Ltd

Alpex Solar Ltd, incorporated in 2008, is a leading photovoltaic module manufacturer and solar energy solutions provider. Among North India’s largest PV module manufacturers, the company produces solar panels, power plants, aluminium frames, IPP solutions, GH2 technology and AC/DC water pumps, catering to diverse renewable energy needs.

Market Cap: ₹1,754.87 Crore

Close Price: ₹723

1Y Return: 109.29%

1M Return: -13.07%

6M Return: 3.59%

5Y Average Net Profit Margin: 2.73%

5Y CAGR: N/A

Sector: Renewable Energy

Azad Engineering Ltd

Azad Engineering Ltd, incorporated in 1983, is a leading manufacturer of aerospace components and turbines. The company supplies precision-engineered products to original equipment manufacturers (OEMs) across the aerospace, defence, energy and oil and gas industries, ensuring high-quality solutions for critical applications worldwide.

Market Cap: ₹9,205.67 Crore

Close Price: ₹1,555.00

1Y Return: 57.36%

1M Return: -14.77%

6M Return: -4.99%

5Y Average Net Profit Margin: N/A

5Y CAGR: N/A

Sector: Engineering

Premier Energies Ltd

Premier Energies Ltd, incorporated in April 1995, is a leading manufacturer of integrated solar cells and panels. The company offers a diverse product portfolio, including monofacial and bifacial solar modules, along with EPC and O&M solutions, catering to India’s growing renewable energy sector.

Market Cap: ₹46,314.25 Crore

Close Price: ₹1,029.00

1Y Return: 22.51%

1M Return: -20.27%

6M Return: 22.51%

5Y Average Net Profit Margin: 2.32%

5Y CAGR: N/A

Sector: Renewable Energy

K.P. Energy Ltd

K.P. Energy Ltd (KPEL), part of the KP Group, specializes in utility-scale wind power infrastructure. The company manages wind farm siting, land acquisition, permits, EPCC of wind projects and balance-of-plant (BoP) infrastructure. KPEL also operates wind turbines and solar power plants as an Independent Power Producer (IPP), primarily in Gujarat.

Market Cap: ₹2,800.31 Crore

Close Price: ₹421.5

1Y Return: 11.54%

1M Return: -15.98%

6M Return: 11.86%

5Y Average Net Profit Margin: 8.43%

5Y CAGR: 88.59%

Sector: Renewable Energy

Suzlon Energy Ltd

Suzlon Energy Ltd is a leading global renewable energy solutions provider and a vertically integrated wind turbine generator (WTG) manufacturer. The company designs, develops and manufactures key WTG components while offering turnkey wind project execution, including installation, operations, maintenance, wind resource assessment and power evacuation services in India and internationally.

Market Cap: ₹73,167.02 Crore

Close Price: ₹53.84

1Y Return: 9.32%

1M Return: -5.7%

6M Return: -22.62%

5Y Average Net Profit Margin: -9.16%

5Y CAGR: 92.25%

Sector: Renewable Energy

BF Utilities Ltd

BF Utilities Ltd, incorporated in 2000, specializes in electricity generation through wind energy and infrastructure development. The company primarily produces wind power, which is utilized by Bharat Forge Ltd. at its Pune plant, while also engaging in infrastructure-related activities to support sustainable energy solutions.

Market Cap: ₹3,075.00 Crore

Close Price: ₹818

1Y Return: 4.17%

1M Return: -13.7%

6M Return: 7.26%

5Y Average Net Profit Margin: 8.67%

5Y CAGR: 20.54%

Sector: Utilities

Waaree Renewable Technologies Ltd

Waaree Renewables Technologies Ltd, incorporated in 1999, specializes in power generation through renewable energy sources and offers consultancy services. As one of India’s largest vertically integrated new energy companies, it operates a 12GW solar panel manufacturing capacity across its facilities in Chikhli, Surat and Umbergaon, Gujarat.

Market Cap: ₹10,013.40 Crore

Close Price: ₹960.55

1Y Return: -1.99%

1M Return: -25.26%

6M Return: -32.87%

5Y Average Net Profit Margin: -4.14%

5Y CAGR: 218.91%

Sector: Renewable Energy

Fundamental Analysis Of NBFC Sector

Authum Investment & Infrastructure Ltd

Authum Investment & Infrastructure Ltd is engaged in fund-based activities, including investments in shares, securities and mutual funds and providing loans. It focuses on structured financing and equity investments in emerging companies. Its total investments grew from ₹3,186 crore in FY22 to ₹10,317 crore in Q2 FY25.

Market Cap: ₹ 29,540.31 Crore

Close Price: ₹ 1,796.55 Rs

1Y Return: 102.81%

1M Return: -4.62%

6M Return: 66.54%

5Y Average Net Profit Margin: –

5Y CAGR: 185.03%

Sector: Diversified Financials

Muthoot Finance Ltd

Muthoot Finance Ltd is a leading non-banking financial company (NBFC) that specializes in providing gold loans. The company primarily operates in Southern India, offering financial services to individuals and businesses through its extensive network of branches.

Market Cap: ₹ 90,110.58 Crore

Close Price: ₹ 2,244.70 Rs

1Y Return: 57.51%

1M Return: 1.93%

6M Return: 20.98%

5Y Average Net Profit Margin: 31.34%

5Y CAGR: 24.15%

Sector: Consumer Finance

Motilal Oswal Financial Services Ltd

Motilal Oswal Financial Services Ltd was founded in 1987 and is a well-diversified financial services firm. The company operates a vast network across 550+ cities with over 2,500 business locations, serving more than 16 lakh customers.

Market Cap: ₹ 40,409.36 Crore

Close Price: ₹ 674 Rs

1Y Return: 50.78%

1M Return: -27.17%

6M Return: 10.5%

5Y Average Net Profit Margin: 25.84%

5Y CAGR: 27.23%

Sector: Diversified Financials

Rail Vikas Nigam Ltd

Rail Vikas Nigam Ltd was incorporated in 2003 by the Government of India. It focuses on implementing various railway infrastructure projects, including doubling, gauge conversion, electrification and major bridges. The company also shares freight revenue with Railways as per agreements with the Ministry of Railways.

Market Cap: ₹ 82,368.72 Crore

Close Price: ₹ 395 Rs

1Y Return: 40.64%

1M Return: -2.03%

6M Return: -30.19%

5Y Average Net Profit Margin: 5.96%

5Y CAGR: 73.53%

Sector: Specialized Finance

Cholamandalam Financial Holdings Ltd

Cholamandalam Financial Holdings Ltd, part of the Murugappa Group, is a Core Investment Company registered with the RBI. It offers a diverse range of financial products and risk management services to both individual and corporate customers through its group companies.

Market Cap: ₹ 27,703.75 Crore

Close Price: ₹ 1,470.20 Rs

1Y Return: 27.26%

1M Return: -3.17%

6M Return: 0.04%

5Y Average Net Profit Margin: 6.17%

5Y CAGR: 21.74%

Sector: Diversified Financials

Bajaj Finance Ltd

Bajaj Finance Ltd is primarily engaged in lending, offering a diversified portfolio across retail, SME and commercial customers. With a significant presence in both urban and rural India, the company also accepts public and corporate deposits and provides a variety of financial services products to its customers.

Market Cap: ₹ 5,24,793.18 Crore

Close Price: ₹ 8,476.65 Rs

1Y Return: 26.34%

1M Return: 15.15%

6M Return: 27.72%

5Y Average Net Profit Margin: 22.56%

5Y CAGR: 12.74%

Sector: Consumer Finance

Sundaram Finance Ltd

Sundaram Finance Ltd, established in 1954, is a registered deposit-taking NBFC. The company engages in retail finance across various domains, including vehicle finance, home finance, mutual funds, general insurance and financial service distribution.

Market Cap: ₹ 51,324.79 Crore

Close Price: ₹ 4,646.90 Rs

1Y Return: 21.98%

1M Return: 4.76%

6M Return: 18.8%

5Y Average Net Profit Margin: 21.02%

5Y CAGR: 22.41%

Sector: Consumer Finance

Shriram Finance Ltd

Shriram Finance Ltd, part of the SHRIRAM Group, is a leading deposit-taking NBFC specializing in commercial vehicle financing, particularly trucks. The company operates 1,758 branches and 831 rural centres, partnering with approximately 500 private financiers to provide financial solutions.

Market Cap: ₹ 1,05,211.84 Crore

Close Price: ₹ 560.60 Rs

1Y Return: 16.13%

1M Return: -4.88%

6M Return: -4.17%

5Y Average Net Profit Margin: 16.71%

5Y CAGR: 18.66%

Sector: Consumer Finance

Housing and Urban Development Corporation Ltd

Housing & Urban Development Corporation Ltd is primarily engaged in financing housing and urban development activities across the country. The company plays a key role in supporting housing projects and urban infrastructure development in India.

Market Cap: ₹ 41,389.28 Crore

Close Price: ₹ 206.40 Rs

1Y Return: 4.3%

1M Return: -14.75%

6M Return: -30.85%

5Y Average Net Profit Margin: 23.88%

5Y CAGR: 40.06%

Sector: Specialized Finance

Mahindra and Mahindra Financial Services Ltd

Mahindra & Mahindra Financial Services Ltd (MMFSL), a part of the Mahindra Group, is a non-banking financial company (NBFC) primarily engaged in financing the purchase of new and pre-owned vehicles, including tractors, cars, commercial vehicles and construction equipment. It also offers SME financing solutions.

Market Cap: ₹ 36,760.91 Crore

Close Price: ₹ 297.50 Rs

1Y Return: 0.24%

1M Return: 8.61%

6M Return: -2.07%

5Y Average Net Profit Margin: 10.64%

5Y CAGR: 4.16%

Sector: Consumer Finance

Green Energy Sector Performance & Growth

The below table shows the green energy sector performance & growth based on a 5-year net profit margin.

Name	Close Price (rs)	5Y Avg Net Profit Margin (%)
SJVN Ltd	95.8	41.4
NHPC Ltd	77.47	31.23
KPI Green Energy Ltd	474.85	16.65
BF Utilities Ltd	818	8.67
K.P. Energy Ltd	421.5	8.43
Adani Green Energy Ltd	989.9	7.01
Waaree Energies Ltd	2,298.30	4.89
Orient Green Power Company Ltd	14.98	3.63
Alpex Solar Ltd	723	2.73
Premier Energies Ltd	1,029.00	2.32

NBFC Sector Performance & Growth

The table below shows the NBFC sector performance & growth based on 5 5-year net profit margin.

Name	Close Price (rs)	5Y Avg Net Profit Margin (%)
Muthoot Finance Ltd	2,244.70	31.34
Indian Railway Finance Corp Ltd	133.5	26.36
Motilal Oswal Financial Services Ltd	674	25.84
REC Limited	441.2	24.72
Housing and Urban Development Corporation Ltd	206.4	23.88
Bajaj Finance Ltd	8,476.65	22.56
Sundaram Finance Ltd	4,646.90	21.02
Indian Renewable Energy Development Agency Ltd	188.2	18.83
Bajaj Housing Finance Ltd	119.58	18.81
Power Finance Corporation Ltd	409.9	17.64

Government Policies & Incentives For The Green Energy and NBFC Sector

The government has introduced various policies and incentives to boost the Green Energy sector, including tax benefits, subsidies and renewable energy certificates. India’s National Solar Mission and the PLI (Production Linked Incentive) scheme aim to promote renewable energy and the manufacturing of solar equipment.

For the NBFC sector, the government provides incentives like priority sector lending status for certain categories of loans, allowing easier access to funds. Additionally, the Reserve Bank of India (RBI) has introduced measures to improve liquidity and reduce operational risks for NBFCs, ensuring stable growth.

Challenges Faced By Green Energy and NBFC Sector

The main challenges faced by both the Green Energy and NBFC sectors include high capital expenditure, policy uncertainty, regulatory complexities and competition. These factors hinder growth, investment potential and operational efficiency in both industries.

• High Capital Expenditure: Both sectors require substantial upfront investment. In green energy, infrastructure and technology costs are significant, while NBFCs face high operational costs related to expansion, servicing and compliance.
  
• Policy Uncertainty: Fluctuating policies and government incentives affect long-term planning in green energy. Similarly, NBFCs face uncertainty due to evolving regulations that impact business models, lending practices and financial stability.
  
• Regulatory Complexities: The green energy sector encounters challenges in navigating complex environmental regulations, while NBFCs deal with strict financial regulations, impacting growth strategies and operational flexibility in both sectors.
  
• Competition: The green energy sector faces technological competition in terms of energy storage and efficiency. NBFCs are challenged by the rise of fintech companies offering digital lending services, forcing traditional players to innovate rapidly.

Future Outlook Of Green Energy and NBFC Sector

The Green Energy sector is poised for significant growth, driven by global climate commitments and India’s ambitious renewable energy targets. As technology advances and costs decline, the sector is expected to attract more investments, contributing to cleaner energy solutions and sustainable development.

The NBFC sector will continue to benefit from increasing financial inclusion and demand for credit across diverse sectors. However, regulatory challenges and liquidity risks remain concerns. With technological innovations and strong growth prospects in retail, housing and infrastructure financing, the sector is likely to expand despite these hurdles.

How to invest in the Green Energy and NBFC Sector Stocks?

To invest in the Green Energy and NBFC Sector Stocks, follow these steps:

• Open a Demat and Trading Account: Choose a brokerage platform like Alice Blue and complete the KYC process to start trading.
• Research the Stocks: Analyze the company’s financials, industry position and valuation to ensure it meets fundamental strength criteria.
• Place Your Buy Order: Log in to your trading account, search for the stock and specify the number of shares you want to purchase.
• Monitor Your Investment: Regularly track the stock’s performance and market news to make informed decisions on holding or selling.
• Brokerage Tariffs: Please note that Alice Blue’s updated brokerage tariff is now Rs. 20 per order, which will apply to all trades.

Difference Between NBFC Sector And Green Energy Sector – Conclusion

• The Green Energy sector focuses on renewable sources like solar, wind and hydro, addressing climate change and sustainability. Technological advancements and global initiatives drive investment and long-term economic growth.
• The NBFC sector offers financial services like loans and insurance, promoting financial inclusion. While facing challenges such as liquidity risks and rising NPAs, it remains a crucial part of the financial ecosystem.
• The government supports the Green Energy sector with policies like tax benefits and subsidies. For NBFCs, incentives include priority sector lending and RBI measures to enhance liquidity and stability.
• Both the Green Energy and NBFC sectors face challenges like high capital expenditure, policy uncertainty, regulatory complexities and rising competition, affecting growth, investment and operational efficiency in both industries.
• The Green Energy sector is set for growth, driven by climate goals and technology advances. The NBFC sector will expand with financial inclusion, despite regulatory and liquidity challenges.
• To invest in Green Energy and NBFC stocks, open a Demat and Trading account with a brokerage platform like Alice Blue, research stocks, place buy orders, monitor investments and be aware of brokerage tariffs like Alice Blue’s Rs. 20 per order.

Green Energy Sector Vs NBFC Sector – FAQs

Disclaimer: The above article is written for educational purposes and the companies’ data mentioned in the article may change with respect to time. The securities quoted are exemplary and are not recommendatory.