The world is switching to green, whether it’s power generation, recycling, using organic products, or addressing social challenges.
In this world where sustainability is taking center stage, India ranks 4th in the renewable sector, and there are various other areas where India is taking a big leap and working on green projects to build a sustainable future.
So if you’re looking for some investment options to get a higher return, lower risk, and stable income, then it’s the right time to invest in India’s best green investment funds and diversify to green investment portfolio to an extent.
At SustVest, we guide you with complete information to make the right investing decisions.
In this guide, we will explore some of the best green investment options available in India, along with their risks and returns.
Let’s dive in!
Some of the Top Green Investment Options in India
When it comes to green investments in India, there are several exciting options that not only contribute to sustainable development but also offer promising returns. Here’s a list of some green energy investment funds available in India with higher returns, lower risks, and stable income:
1. Green Bonds
Green Bonds are the financial instruments the government issues to raise funds for environmental projects. There are various environmental projects for which bonds are issued, such as renewable energy sector, sustainable infrastructure, energy-efficient technologies etc.
It allows investors to contribute to government projects by buying green bonds and getting higher returns and stable income.
There are numerous benefits of buying these green energy investment funds, such as a stable income stream, capital appreciation, lower risks as its government projects, and good returns. Additionally, these bonds build investors’ credit worthiness.
- Lack of Liquidity: Investing in green bonds comes with a liquidity risk. Unlike other assets, green bonds are challenging to trade in different markets and difficult to buy/sell quickly.
- Interest Rate Fluctuations: Green bonds come with a fluctuating interest rate. If the interest rate changes, it impacts the market value of green bonds.
- Regulatory and Policy Risk: Government policies and regulations can impact the profitability and value of green bonds.
- Market Volatility: Market volatility can affect the value of green bonds due to market conditions and other economic factors.
- Capital Appreciation: Green bonds are a growing field, and the market value of green bonds will increase over time. So the invested value of green bonds will appreciate.
- Portfolio Diversification: Green bonds investment allows investors to diversify their portfolio by investing in different sectors and lowering the risk, leading to higher returns.
- Regular Income: Investors will get a regular interest income from green bond investments. So it can be a stable income source for investors.
Green bonds are a considerable investment option for those who want to invest their money long-term, as liquidity is limited and interest fluctuates, so investors should be prepared for long-term profitability.
Read here to know: How To Invest in Green Bonds India?
2. Sustainable Real Estate
Sustainable Real Estate development means that buildings and communities are made of eco-friendly materials, including renewable energy, waste management, water conservation, and many more.
According to the Indian Green Building Council (IGBCL), buildings and infrastructure are responsible for 40% of global carbon emissions. So real estate plays a major role in climate change.
That’s why the demand for sustainable real estate grows, and various investors start investing in sustainable real estate properties to get higher financial returns and contribute to a sustainable future.
Investing in sustainable real estate is worth adding to an investor’s portfolio for a sustainable future.
- High Investment Required: Investing in sustainable real estate demands a high upfront cost. It’s a bigger risk for investors to invest a large amount initially.
- Financing and Liquidity Risk: Financing for sustainable real estate projects can be challenging compared to traditional properties. Because these sustainable properties come with different criteria for financing. Investing in them can lower liquidity and make them difficult to sell.
- Detailed Market Research and Awareness: Investing in sustainable real estate projects is not easy. Investors must understand market prices, location, opportunities, future predictions, and much more before investing in green energy investment funds like this.
- Long Payback Period: Investing in sustainable real estate has a longer payback period than traditional real estate. As it requires a high upfront cost, it takes more time to cover the investment.
- Property Value Appreciation: Property value appreciation has huge potential over time. Sustainable real estate is a growing future, and the market will go higher and appreciate investors’ capital.
- Stable Income Stream: It can provide a stable income via rental money and high returns.
- Tax Benefits: The government offers various tax incentives, deductions, and exemptions on sustainable real estate that investors can benefit from.
- Lower Maintenance Cost: Sustainable real estate properties are eco-friendly and durable, reducing the maintenance cost and increasing the value.
If you’re interested in real estate and want to build passive income from your investments, sustainable real estate is one of the best green energy funds in India with capital appreciation.
3. Renewable Energy Projects
Renewable energy is one of the best green energy investment funds for investors to get higher returns, lower risk and long-term profitability.
India stands 4th for renewable energy production to reduce the waste of resources like fuel for electricity production and address social challenges such as climate change.
India primarily focuses on making renewable energy their main source of clean electricity instead of producing it in traditional ways.
Renewable energy projects include solar, wind, thermal, and hydropower projects that generate electricity from natural resources.
The government understands the importance of renewable energy, so they’re spreading awareness to switch to renewable energy by offering various incentives, tax benefits, support, and much more. These renewable energy projects are risk-free and have growing demand because the government promotes them.
So it’s the right time for investors to contribute to this growing sector and generate higher returns with long-term profitability.
However, investing in the renewable energy sector requires market research and up-to-date knowledge, and this is where we will guide you.
At SustVest, we guide you to make informed investment decisions in this sector under expert guidance to get higher returns, stable passive income, and long-term profitability.
- Regulatory Uncertainty: It’s subject to govt. regulations and policies. If there are any changes in regulations, then they can directly affect the project’s performance.
- Dependency on Sources: Renewable energy projects are dependent on natural resources such as the sun, wind, water, hydro etc. So the performance of these renewable energy projects is based on the sources.
- Passive Income Stream: Investing in government renewable energy projects such as solar, wind turbines, etc. can generate passive income streams and allow investors to build a stable income with a one-time investment.
- Long-term Profitability: Renewable energy is a growing sector that the government and various giant companies support. So the investment will grow over time and generate long-term profitability.
- Employment Generation: Investing in govt-back renewable energy projects can greatly contribute to employment generation. As the government creates more projects, the employment demand increases, leading to country growth.
- Contribute to a Sustainable Future: Renewable energy is the future, so the government is taking initiatives to promote renewable energy. Investors can spread awareness and contribute to a sustainable future by investing in renewable energy projects.
If you plan to diversify your portfolio, you must add renewable energy to your list of the best green energy investment funds to get risk-free, higher returns, and passive income. Click here to learn how you can start your investment in renewable energy.
4. Electric Vehicles (EVs)
The Electric Vehicles (EVs) market is rapidly growing and creating a green infrastructure in India. According to the report, India’s Electric Vehicle market size is expected to grow from $3.21 billion in 2022 to $113.99 billion by 2029.
It clearly shows the bright future of the EV market and how the infrastructure is shifting to renewable energy.
The government takes various initiatives to promote EVs by offering tax benefits, incentives, subsidies, and favorable policies and by creating infrastructure, including electric vehicle manufacturing, charging stations and battery technology.
The EV industry is hot right now, and investors can invest in this market to get long-term returns and financial benefits and support the country’s development. However, detailed research and market analysis are required to invest in green energy investment funds for higher returns.
- Market Volatility: Currently, the EV market is in its initial stages. So there is a high chance of market volatility due to technological advancement, customer preferences, etc. Overall, it affects the investment value.
- High Initial Capital Required: Investing in EVs may require high initial capital, which is considered a risky investment in this volatile market.
- Dependency on Government Policies: Investors need to be aware of government initiatives towards EVs because the success of the EV market depends on government policies and regulations.
- Capital Appreciation: As the EV market grows, there is a high chance of capital appreciation over investment.
- Long-term Profitability: EVs are the future, and the government knows the value of renewable energy. By Investing in the EV market, investors can build long-term profitability.
- Support for a Sustainable Future: Using eco-friendly vehicles can reduce carbon emissions, reduce the wastage of fossil fuels, and keep the environment sustainable. By investing in EVs, investors can contribute to a sustainable future.
- Tax Benefits: The government offers various tax incentives and benefits for electric vehicles (EVs) to promote awareness about renewable energy and a sustainable future.
It’s a considerable investment option from green energy investment funds to to an investor’s portfolio for long-term returns and stable income.
These are some best green energy investment funds in India that every investor can consider to get high returns, stable income and long-term profitability. However, you must research and consider risk and returns before investing in any green energy investment funds. There are many other investment options are also available such as green energy mutual funds.
FAQ: Green Energy Investment Funds
Can I Invest in Green Energy Investment Funds?
You can start your investment journey in green energy with expert guidance. Contact SustVest, and we will guide you to make informed investment decisions and get higher returns and long-term profitability.
What are the best green energy investment funds available in India?
Some of the best green energy investment funds are – renewable energy mutual funds, green bonds, sustainable real estate, and electric vehicles (EVs).
What are some of the mutual funds that invest in renewable energy in India?
- ICICI Prudential Global Stable Equity Fund: While not exclusively focused on renewable energy, it has the flexibility to invest in sectors such as energy, including renewables.
- Aditya Birla Sun Life New Millennium Fund: This fund may invest in sectors such as power, energy, and utilities, which could include companies involved in renewable energy.
- DSP BlackRock Natural Resources and New Energy Fund: This fund is more specifically focused on natural resources and new energy sectors, including renewable energy.
- Franklin Build India Fund: While not exclusively focused on renewable energy, it invests in sectors like construction and allied activities, including infrastructure for renewable energy.
To Wrap Up
Overall, India offers remarkable green energy investment fund options for investors, such as renewable energy, green bonds, EVs, sustainable real estate, etc., to get higher returns, stable income, capital appreciation, and long-term profitability.
We hope this article helps you find some green energy investment funds in India to get higher returns.
So if you’re ready to start your investment journey towards green energy investment India, get in touch with SustVest, and our experts will guide you to make informed investment decisions and get you higher returns, long-term profitability, and a passive income stream. Click here to start your investment journey today!
Founder of Sustvest
Hardik completed his B.Tech from BITS Pilani. Keeping the current global scenario, the growth of renewable energy in mind, and people looking for investment opportunities in mind he founded SustVest ( formerly, Solar Grid X ) in 2018. This venture led him to achieve the ‘Emerging Fintech Talent of the Year in MENA region ‘ in October 2019.