Analysis of the week: International players drive deal activity for onshore wind & solar PV assets in the APAC

Rising power demand and supportive policies are spurring investor interest, with India & Australia leading the activity. 

– International players accounted for 57% of the deal activity: 

Asset-level acquisitions for development projects have emerged as the preferred investment approach in the region. Meanwhile in India, companies have strategically focused on corporate-level investments in local developers to grow their portfolio organically. 

– PE firms/PE-backed companies dominate the buyer group, leading ~37% of all deals:

The decline in capital expenditures, primarily attributed to the decreasing cost of equipment, combined with comparatively lower operating expenditures in the region, establishes a favorable environment for private equity (PE) firms to achieve double-digit returns on their investments.

– India accounted for 33% of the region's activity for solar assets: 

Availability of subsidies of up to 30% of the project cost under the Central Financial Assistance program and tenders to sell power to state-run utilities at fixed prices under long-term PPAs are the key drivers for deal activity.

– ASEAN countries are emerging as key players in the region's power market:

The region witnessed a 55% y/y rise in deal activity in 2022. While H1 2023 saw a marginal slowdown due to macroeconomic headwinds, deal activity in the region is expected to pick up pace in the coming months as the region experience economic and demographic growth.  

The above analysis is proprietary to Enerdatics’ energy analytics team, based on the current understanding of the available data. The information is subject to change and should not be taken to constitute professional advice or a recommendation.

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