As far as alternative energy and organic farming are concerned, investment advisor Rustagi’s thoughts are, “As the government is pushing the plans to make renewable energy generation mandatory for power producers, all companies will go into renewable energy. This will boost investments in the sector benefiting investors over time. And incentives announced by the government for solar and wind energy companies would promote and attract foreign investment to the sector. Some of the companies like RIL, Suzlon, Essar Power and Tata BP Solar have been investing more in renewable energy. Organic farming can be a promising sector since the demand for organic products has been on the rise year after year”. Another green sector Rustagi points out is that of bio-fuels. “Bio-fuel is likely to gain importance in the light of increasing energy demand. Bio-fuel companies can be a good bet for serious long term investors” Rustagi adds and summarises, “Efforts by these companies in improving environmental sustainability are likely to improve their overall efficiency and contribute significantly to their bottom lines. This in turn would benefit investors holding stocks of these companies in the long run”.
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Having facilitated investments in unlisted small and medium enterprises in the clean technology and clean energy sector, Raghupathy’s firm belief is that, “These players will be listed entities of tomorrow providing tremendous value to the stakeholders and environment. The current trend may facilitate platforms like the Alternate Investment Market (AIM) on the Indian soil in near future to cater not only for equity investors but also for carbon trading”.
Echoing these positive sentiments even through a recession, venture capitalist Gupta avers, “In a recession, the best companies will be those focused on energy efficiency because of better capital efficiency than on energy generation side. Given the capital constraints, energy efficient solutions with low payback period will be very interesting, especially for high energy intensive industries. Through the economic downturn, the best companies will be those aligned with government policies and government spending,” Gupta illustrates this further, “For example, companies aligned with APDRP (Accelerated Power Development and Reform Program) scheme where government is spending billions of dollars on grid upgradation will do very well even in a recession”.
While Indian investors and companies alike are getting better tuned to the advantages of triple bottom line (People, Planet, Profit) investing, entrepreneurs that are thinking green could make others see green.
Irawati Gowariker, a communications specialist and a media professional, has previously steered Corporate Social Responsibility for HSBC’s software development arm.
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