India’s nuclear power story is entering its next phase, with companies already scouting sites for projects. Investors, however, may have to wait years for those plans to translate into earnings.
NTPC Ltd has identified more than 30 locations across multiple states and begun preliminary studies at 10 of them, according to reports. Adani Power is evaluating sites in Madhya Pradesh, while Tata Power has shortlisted locations in Madhya Pradesh, Odisha and Gujarat.
The moves come even as the rules governing private participation are still being finalized. That creates a dilemma for investors: does the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act, 2025, offer an actionable opportunity in listed stocks now, or is the market getting ahead of a story that could take years to unfold?
The draft rules have been placed in the public domain for consultation, with feedback welcome until 4 September.
The SHANTI Act came into force on 20 December 2025 after receiving presidential assent. It seeks to modernize India’s nuclear sector by bringing various aspects of nuclear development under a single framework and supporting the country’s long-term energy goals.
Nuclear door opens
The draft SHANTI Rules, 2026, mark a major shift in India’s nuclear policy by opening the civil nuclear power generation sector to private players. The framework introduces a single composite licence, allows access to approved domestic and international technologies, and expands the use of nuclear energy beyond power generation, while retaining stringent safety and liability requirements.
Calling it a watershed moment in India’s nuclear policy, Rupesh Sankhe, senior vice president - Power Utilities, Capital Goods at Elara Capital, said the framework introduces a single licence for building, owning and operating nuclear facilities, allows access to approved domestic and foreign technologies, and expands nuclear use beyond electricity generation to areas such as captive power, industrial heat and hydrogen production.
At the same time, private entry remains subject to stringent financial, technical, safety, fuel supply, liability, waste management and decommissioning requirements, including mandatory insurance and financial security, he added.
Sankhe said the move could significantly boost India’s small modular reactor (SMR) ambitions, benefiting developers such as NTPC, Tata Power, Reliance, Adani Power and Jindal Nuclear. It could also create a sizeable opportunity for EPC and equipment players including Larsen & Toubro (L&T), BHEL, Power Mech, MTAR Technologies and Walchandnagar Industries.
The long wait
The policy shift, however, does not mean a near-term earnings opportunity.
Sudhanshu Bansal, power research analyst at JM Financial Institutional Securities, views the SHANTI draft rules as an important step forward, but cautions that the nuclear opportunity remains a long-term story. While the government has moved with notable urgency, he estimates it could take another six to eight months for the rules to be finalized, followed by the release of detailed standard operating procedures, a process that could stretch another 10-12 months.
“It's easier said than done,” Bansal remarked, pointing to key challenges around fuel availability, liabilities, technology adoption and most importantly talent availability.
As a result, he believes it is still too early for investors to buy power stocks purely on the SHANTI narrative. In the long run, however, companies interested in nuclear power generation and nuclear equipment manufacturing, including Adani Power, NTPC, Tata Power, L&T and BHEL, stand to be among the biggest beneficiaries if India’s nuclear ambitions gather momentum.
That makes the timing of the investment case critical. Even after the rules and operating procedures are in place, companies will need to move from site identification and preliminary studies towards actual projects.
Stocks have moved
Valuations add another layer of caution. Bansal said most power generation and power equipment supplier stocks now appear fairly valued given very good visibility on power demand, huge capital expenditure, and earnings.
Based on current market price, Adani Power trades at 31.05 times, well above its five-year average of 14.04 times, while L&T at 33 times is also slightly above its long-term average of 31 times. Vedanta, on the other hand, trades at 11.7 times, well below its five-year average of 22.4 times, while BHEL’s 92.3 times multiple is also below its long-term average of 115.1 times.
The performance of nuclear-linked stocks has been mixed. Reliance Industries (-15.8%), L&T (-0.5%) and Tata Power (0.4%) have been largely subdued so far in 2026, while Adani Power has gained 43.7%, BHEL 47.8%, and MTAR Technologies 195.1% so far this year. Vedanta and Walchandnagar Industries have also risen 16.7% and 17.7%, respectively.