SP Tulsian of sptulsian.com advised exiting PTC India at around Rs 66-68 with a time horizon of about couple of months.
Tulsian told CNBC-TV18, “At one time PTC India used to enjoy very good position because of the lone player in the power trading business. But now seeing the erratic performance of the power generation company and good shortage – if the commodity is in shortage the generators or the producers of the power will be reluctant to pay any kind of commission. And the company is deriving all their commission from the – matching with the buyer and seller and that is the reason we have been seeing the fall in the margin in the absolute numbers. So, may be company will not be able to post an earnings per share (EPS) of more than Rs 6 on a consolidated basis.”
“So, the contraction in the power trading space is also taking place. Now the share is ruling at a PE multiple of close to double digit which is likely to remain either stagnant or may marginally get corrected. So, I will advice an exit from the stock but not at these levels. Rs 66-68 looks a good level because generally the positive view starts building up on the power sector may be because of some initiative having taken place by the government in respect to the clearances or may be the power purchase agreement (PPA) being signed by all the power companies. So, he/she should look for those levels may be about Rs 66-68 with a time horizon of about couple of months,” Tulsian added.