India's power demand in February increased by only 1%, and Jefferies is optimistic about JSWE and NTPC.

Investing.com — According to Jefferies report, India’s electricity demand in February 2026 grew only 1% year-over-year, compared to a 2% increase in February 2025. This moderate growth is due to above-average monsoon season, which suppressed electricity consumption.

From April 2025 to February 2026, electricity demand increased just 1% year-over-year. Jefferies notes that to meet their 2% forecast for fiscal year 2026, demand in March 2026 needs to grow by 14%. Power generation in the first 12 days of March increased by 2%, and with rising temperatures, an improvement is expected.

Demand patterns vary across regions in India. The western and northern regions each account for 31% of the country’s electricity demand, with growth of 2-5% and 1-4%, respectively. The southern region accounts for 25% of demand, remaining flat year-over-year, while the eastern region makes up 12%, with growth of 2-5%. Peak demand reached 244 GW, up 3% year-over-year, with the peak gap largely under control. Coal plant capacity utilization is at 69%, down from 74% in February 2025, while hydropower generation increased by 10%.

Renewable energy project tenders totaled 3.3 GW in February 2026, with an additional 0.6 GW added before mid-March. Of the 18.0 GW renewable tenders in this fiscal year so far, 52% were awarded between December 2025 and mid-March 2026. Slowing demand growth has delayed power purchase agreement signings, with over 40 GW of agreements still unsigned.

Electricity distribution companies turned profitable in fiscal year 2025, ending at least a decade of losses. The sector posted a profit of 0.03 rupees per unit, compared to a loss of 0.16 rupees per unit in FY2024. Private distribution companies supply 7% of electricity, with profits increasing 3.3 times, while state electricity boards’ losses decreased by 70%.

Among the top ten states supplying 70% of electricity, Maharashtra became profitable after five years, and Tamil Nadu after at least 15 years. Total technical and commercial losses decreased from 21.9% in FY2021 to 15.0% in FY2025, and accounts payable days for state electricity boards fell from 169 days in FY2022 to 112 days in FY2025.

Jefferies maintains JSW Energy and NTPC as preferred stocks, citing that increased execution will drive double-digit medium-term profit growth. The firm also maintains a buy rating on Power Grid, as capital expenditures are increasing.

This article was translated with the assistance of artificial intelligence. For more information, please see our Terms of Use.