OPG is getting the wind back in its sails

However, the group has come up against a number of challenges recently, which has sent the share price down, despite the likelihood that the issues will prove temporary. In the group's January trading update it outlined a triumvirate of negative events. The first was the de-monetisation of India's high-denomination currency, which had a short-term effect on consumer spending and demand for energy. The second was the death of Ms Jayalalithaa Jayaram, chief minister of Tamil Nadu, where the group's Chennai plants are based. This led to depressed commercial activity for roughly a week. Finally, the state was hit by a cyclone. This caused only minor damage to OPG's plant, but regional transmission infrastructure was severely affected, which again had an effect on commercial activity. According to the group's most recent trading update, the Chennai plant's load factor - the ratio of energy output compared to the maximum possible output of a plant - was pushed down to 76 per cent for the year to March 2017, compared with expectations of 80 per cent.

Overall, though, there are encouraging signs emerging. The group's Gujarat plant, which is younger than Chennai, increased its average plant load factor to 63 per cent for the year, from 52 per cent in 2016. The company has also made important progress in addressing payment delays by the state electricity companies and expects to get most of the money due in 2018. This has involved an amendment of the share capital rights in the Gujarat subsidiary. At the end of September, about £20m had been collected from OPG customers by the state utility and still needed to be paid over.

Meanwhile, even accounting for the lower-than-expected productivity, total generation for the Chennai plant was 12 per cent higher than in 2016. The group is also pursuing two solar projects, one 62MW development in Karnataka, of which 40MW has secured debt financing, with sanction for the remaining 22MW expected in the next few weeks. The group has also secured a letter of intent for a 25-year power purchase agreement for a 124MW project in Jharkand. Once these are completed, solar will account for 21 per cent of the group's generation capacity.