IEX and Power Sector Outlook for FY26
The Indian power sector is poised for stable growth in FY26 as domestic electricity demand is expected to expand by 4–4.5%, according to ICRA. This steady rise follows robust consumption trends and efficient coal logistics that have supported grid stability and pricing.
India’s power demand touched 1,695 billion units (BU) in FY25, marking a significant base for future expansion. Despite a subdued first half of FY26 due to early monsoon and a high comparative base, analysts expect a revival in demand in the second half as industrial consumption picks up.
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The coal inventory position remains comfortable, with stock levels equivalent to 14.7 days of consumption as of October 10, 2025. This improvement is attributed to enhanced supply coordination between Coal India, Railways, and state distribution companies.
| Metric | Value | YoY / QoQ Notes |
|---|---|---|
| Electricity Demand Growth (FY26E) | 4–4.5% | Steady rise expected |
| Power Consumption (FY25) | 1,695 BU | Base year for comparison |
| H1 FY26 Growth | ~1% | Weak due to early monsoon |
| Coal Inventory (Oct 2025) | 14.7 days | Comfortable levels |
Healthy demand, reliable fuel availability, and a supportive macro environment point toward sustained energy trading activity on platforms such as IEX. As renewable generation continues to scale, the exchange is likely to benefit from greater market participation and short-term power trading volumes.
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From an investor’s viewpoint, IEX remains a unique play on India’s evolving energy landscape, given its near-monopolistic position in the power exchange market. However, returns will depend on the pace of industrial rebound, renewable integration, and potential regulatory changes around market coupling.
Investor Takeaway
Indian-Share-Tips.com Nifty Expert Gulshan Khera, CFP®, who is also a SEBI Regd Investment Adviser, believes that the power sector’s medium-term outlook remains strong with consumption recovery likely in H2 FY26. IEX could witness moderate volume growth driven by healthy industrial demand and improved liquidity in the short-term power market.
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Related Queries
- Why is IEX a key beneficiary of India’s energy transition?
- Will coal supply stability sustain power sector growth?
- How can investors gain from renewable integration in FY26?
SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
