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By Shritama Bose

MUMBAI, July 8 (Reuters Breakingviews) - Dark clouds are gathering over India's renewable energy boom. A global consortium last week raised its offer to take ReNew Energy RNW.O, the country's second-largest green power producer, private from New York. But the implied $10 billion valuation is a discount to peers trading in Mumbai. Even with the prospect of a relisting back home, the buyers can drive a hard bargain.

The latest offer of $8 per share is a measly 13% increase from a December proposal and values the target's enterprise at just under 7 times its forecast next-fiscal year EBITDA, per LSEG. That's well below the 19 times at larger rival Adani Green ADNA.NS, which trades in Mumbai.

That will be a disappointment for minority shareholders, who own 36% of the company. Worse, the buyer group, including ReNew founder and CEO Sumant Sinha and the Canada Pension Plan Investment Board, insists this is a final offer and that it will give investors "immediate liquidity and value certainty not available in public markets".

They may have a point. ReNew listed in 2021 on Nasdaq via a special purpose acquisition company, and its shares have been underwater since, prompting Sinha to complain that public markets value renewable energy businesses poorly. Moreover, no other bidders have emerged, strengthening the consortium's hand.

And it will not be lost on investors that the target's peers, though richly valued, are losing their shine. Once stock market darlings, Adani Green Energy, state-backed NTPC Green NTPG.NS and others have all underperformed the broader Indian market this year; as recently as February, Adani Green's enterprise traded on over 40 times forward EBITDA. That might dim prospects of a quick relisting at home for ReNew.

Increasing concerns of overcapacity in India's booming green power sector are probably to blame. The government issued a record 73 gigawatts of utility-scale renewable energy tenders last year, but undersubscriptions, cancellations, delays plus a backlog of unsigned power purchasing agreements are all also rising, according to the Institute for Energy Economics and Financial Analysis. In May, spot power prices in the country dropped to zero for the first time, due to a glut of solar generation.

Against this moody backdrop, ReNew's long-suffering shareholders may be ready for an exit.

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CONTEXT NEWS

A consortium of shareholders in Nasdaq-listed green power producer ReNew Energy Global on July 2 made a final non-binding offer to take the company private. The group raised its offer to $8 per share from the $7.07 it had proposed in December.

The new offer represents a 17.5% premium to the last traded price and values the company's equity at nearly $3 billion, according to Breakingviews calculations.

Canada Pension Plan Investment Board, Abu Dhabi Investment Authority, and ReNew Chair Sumant Sinha, who control a combined 64% of shareholder votes in the company, are members of the consortium. United Arab Emirates-based Masdar joined the group as a new investor.

The revised proposal will give shareholders "immediate liquidity and value certainty not available in public markets", the consortium said in a letter to ReNew's board.

(Editing by Robyn Mak; Production by Ujjaini Dutta)

((For previous columns by the author, Reuters customers can click on BOSE/shritama.bose@thomsonreuters.com))